Consideration, Capacity and Free Consent: Coercion, Undue Influence, Fraud and Misrepresentation Questions

Question 1

Define consideration.

Accepted Answer

Consideration is something in return for a promise—an act, abstinence or promise done at the desire of the promisor.

Question 2

Who is competent to contract?

Accepted Answer

A person who is major, of sound mind and not disqualified by law is competent to contract.

Question 3

Define free consent.

Accepted Answer

Consent is free when it is not caused by coercion, undue influence, fraud, misrepresentation or mistake (as applicable).

Question 4

What is coercion?

Accepted Answer

Coercion is threatening or committing an act forbidden by law, or unlawfully detaining property, to force someone to contract.

Question 5

What is fraud?

Accepted Answer

Fraud is intentional deception by false statements or concealment of material facts to induce another to contract.

Question 6

What is misrepresentation?

Accepted Answer

Misrepresentation is an innocent false statement made without intent to deceive that induces another to contract.

Question 7

State any three rules/essentials of consideration.

Accepted Answer

Rules of consideration (any three):

1) It must move at the desire of the promisor.
2) It may move from promisee or any other person.
3) It may be past, present or future, but must be lawful and real.

Question 8

Explain any three exceptions to the rule “no consideration, no contract”.

Accepted Answer

Exceptions (any three):

1) Agreement in writing and registered based on natural love and affection.
2) Promise to compensate for past voluntary services.
3) Written promise to pay a time-barred debt.

(Other exceptions as per syllabus may be accepted.)

Question 9

Explain capacity to contract (any three points).

Accepted Answer

Capacity to contract requires:

1) Majority age.
2) Sound mind at the time of contract.
3) Not disqualified by law.

Therefore, minors and persons of unsound mind are generally not competent.

Question 10

Differentiate between coercion and undue influence (any three points).

Accepted Answer

Coercion vs undue influence:

| Point | Coercion | Undue influence |
|---|---|---|
| Nature | force/threat, unlawful detention | dominance of will/relationship |
| Method | fear and pressure | unfair advantage using position |
| Example | threat to harm/property detention | guardian influencing ward |

Question 11

Differentiate between fraud and misrepresentation (any three points).

Accepted Answer

Fraud vs misrepresentation:

| Point | Fraud | Misrepresentation |
|---|---|---|
| Intention | intention to deceive | no intention to deceive |
| Nature | deliberate falsehood / concealment | innocent wrong statement |
| Remedy | voidable + damages possible | voidable; generally no damages like fraud |

Question 12

State the effect of coercion, fraud and misrepresentation on a contract (any three points).

Accepted Answer

Effects:

1) Coercion: contract is voidable at option of aggrieved party.
2) Fraud: contract is voidable; damages may also be claimed subject to law.
3) Misrepresentation: contract is voidable; remedy is generally rescission and restoration.

Question 13

Explain consideration and the rule “no consideration, no contract” with exceptions. Write in exam style and include a table.

Accepted Answer

Consideration means something in return for a promise. It may be an act, abstinence or promise done at the desire of the promisor. Consideration is one of the important essentials of a valid contract.

General rule: **No consideration, no contract**—an agreement without consideration is void.

**Common exceptions:**

| Exception | Meaning (exam-friendly) |
|---|---|
| Natural love and affection | written and registered agreement between near relatives |
| Past voluntary service | promise to compensate for voluntary services already done |
| Time-barred debt | written promise to pay a debt barred by limitation |

Thus, consideration is generally necessary, but law recognizes certain exceptions to ensure fairness and justice.

Question 14

Explain free consent and discuss coercion, undue influence, fraud and misrepresentation with a comparison table.

Accepted Answer

Consent means parties agree upon the same thing in the same sense. Consent is free when it is not caused by coercion, undue influence, fraud, misrepresentation or mistake. If consent is not free, the contract is generally voidable at the option of the aggrieved party.

**Comparison of factors affecting free consent:**

| Basis | Coercion | Undue influence | Fraud | Misrepresentation |
|---|---|---|---|---|
| Nature | force/threat | dominance of will | intentional deception | innocent false statement |
| Intention | to force consent | to gain unfair advantage | to deceive | no intent to deceive |
| Remedy | voidable | voidable (court may modify) | voidable + damages possible | voidable (generally no damages) |

Therefore, understanding these differences helps identify the correct remedy and the nature of the contract in exam problems.

Question 15

Write a detailed note on capacity to contract and minor’s agreement. Include key points and conclude.

Accepted Answer

Capacity to contract means the legal competence of parties to enter into a contract. Under contract law, only competent persons can create enforceable contractual obligations.

**Who is competent?** A person is competent to contract if:
1) He/she has attained majority.
2) He/she is of sound mind at the time of making the contract.
3) He/she is not disqualified by law.

**Minor’s agreement:** A minor is not competent to contract, so a minor’s agreement is generally void. The law, however, protects minors in certain situations. For example, if necessaries are supplied to a minor, the supplier can be reimbursed from the minor’s property (not personal liability).

Thus, capacity is a key requirement of a valid contract. Without capacity, the agreement cannot create enforceable rights and duties like a normal contract.

Consideration, Capacity and Free Consent: Coercion, Undue Influence, Fraud and Misrepresentation

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