Sale agreement with minor not valid: Supreme Court

Contracts entered into by minors have no enforceability in the eyes of the law, the Supreme Court has reiterated. The apex court made this observation while upholding an order of the Madurai Bench of the High Court (HC) of Madras, in which the HC had said a sale agreement entered into a minor had no legal sanction.

For the uninitiated, the parties must be competent to contract for an agreement to become a contract under the provisions of the Contract Act, 1872. Under the law, the age of majority is a condition for competency.

While pronouncing its verdict in the Krishnaveni versus MA Shagul Hameed & Another case on February 15, 2024, the HC had said: “A minor is not competent to enter into an agreement. It is void as per Section 11 of the Indian Contract Act, 1872.Therefore, the suit founded on the strength of such a void agreement is liable to be dismissed. The Court below declined to accept the said stand on the ground that a minor can be a beneficiary under an agreement.”

While dismissing the plea of Krishnaveni, the apex court said: “There is no dispute on the contention raised by the defendants in the suit that the appellant was a minor at the time of the said agreement dated 03.09.2007. Therefore, such contract with a minor, was rightly found to be a void contract by the High Court.

Krishnaveni versus MA Shagul Hameed & Another case

The appellant Krishnaveni was a minor (over 16 years of age) at the time when the sale agreement dated 03.09.2007 was executed with the respondents. Under the said agreement, the minor had agreed to purchase some immovable property. The sellers were given advance for the purchase of the property. In 2010, a plea was filed by Krishnaveni through her mother, seeking a direction to the defendants to perform their part of the contractual obligation, in terms of the sale agreement.

The defendants in the suit, who were the sellers in the sale agreement, filed two applications under Order XII Rule 6 of the Civil Procedure Code based on admission of Gowri (appellant’s mother) that the appellant was a minor at the time of the sale agreement and therefore no claim for specific performance can lie on the basis of such void sale agreement.

However, the additional subordinate judge at Tiruchirapalli, Tamil Nadu, in his order  in April 2017 opined that the objections of the defendants can be considered during the trial of the suit and the same need not be considered as a preliminary issue and accordingly, the application filed by the defendants came to be dismissed.

The defendants then moved the Madurai Bench of the High Court of Madras by filing a revision petition. The judge in January 2019 allowed the revision petition.