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Persons of unsound mind and persons disqualified by law

Contract I · Unit II · Topic 9 of 24 · 6 min read

The test of sound mind in section 12, lucid intervals and drunkenness, the supplier's claim for necessaries under section 68, and the classes of persons disqualified from contracting by other laws.

On this page
  1. 1. Section 12: the test
  2. 2. Burden of proof and lucid intervals
  3. 3. Drunkenness and other temporary incapacity
  4. 4. Effect: void, not voidable
  5. 5. Necessaries supplied to a person of unsound mind: section 68
  6. 6. Problem
  7. 7. Persons disqualified by law
  8. How this is examined
Cases checked to exist. Read the judgment before quoting a holding.

Every case cited here has been checked to exist — the citation resolves and names the right parties. The propositions attributed to each case have not been verified line by line against the judgment. Case names link through to the full judgment: read it before quoting a holding in an examination answer, and never carry a proposition from notes into court on trust.

A test of the moment. Section 12 does not ask whether a person is generally sane. It asks whether, at the time he makes the contract, he could understand it and form a rational judgment about its effect on his interests. That is why a usually unsound person can contract in a lucid interval, and a usually sound person cannot contract while delirious or dead drunk.

1. Section 12: the test

A person is said to be of sound mind for the purpose of making a contract if, at the time when he makes it, he is capable of understanding it and of forming a rational judgment as to its effect upon his interests. Two limbs, both required:

Section 12 then states the two rules that follow:

The statutory illustrations: (a) a patient in a lunatic asylum, who is at intervals of sound mind, may contract during those intervals; (b) a sane man who is delirious from fever, or who is so drunk that he cannot understand the terms of a contract or form a rational judgment as to its effect on his interests, cannot contract while the delirium or drunkenness lasts.

2. Burden of proof and lucid intervals

The law presumes sanity. A party who alleges unsoundness must prove it. Once he proves that the person was usually of unsound mind, the burden shifts to the party relying on the contract to show that it was made in a lucid interval. The reverse also holds: if a person was usually of sound mind, whoever says he was not, at the moment of contracting, must prove it.

Unsoundness is a question of fact. Old age, physical weakness or illiteracy do not by themselves make a person of unsound mind, though they may be relevant to undue influence under section 16.

3. Drunkenness and other temporary incapacity

Intoxication counts only if it reaches the level described in illustration (b): the person could not understand the terms or judge their effect. Being merely under the influence is not enough. The same applies to delirium, hypnosis, or the effect of drugs. The question is always the state of mind at the time of contracting.

4. Effect: void, not voidable

The Act does not say so expressly, but sections 10 and 11 require a competent party, and the reasoning of Mohori Bibee v. Dharmodas Ghose (PC, 1903) applies equally to unsoundness. An agreement by a person of unsound mind is void. English law treats it as voidable where the other party knew of the incapacity (Imperial Loan Co. v. Stone, 1892); Indian law does not adopt that distinction.

5. Necessaries supplied to a person of unsound mind: section 68

Section 68 applies to any “person incapable of entering into a contract”, so it covers persons of unsound mind as much as minors. Where such a person, or anyone whom he is legally bound to support, is supplied with necessaries suited to his condition in life, the supplier is entitled to be reimbursed from the property of the incapable person. The statutory illustrations are directly in point:

The liability is of the property only; there is no personal decree.

6. Problem

Ramesh, a shopkeeper, supplies food grains, clothes and school books to the wife and children of Suresh, who is a lunatic. Suresh owns agricultural land. Can Ramesh recover the price?

Issue. Whether a supplier of necessaries to the dependants of a person of unsound mind can recover their price, given that no contract with that person is possible.

Law. Under sections 11 and 12, Suresh is not competent to contract, and any agreement with him is void. Section 68, however, gives a supplier of necessaries to an incapable person, or to anyone whom he is legally bound to support, a right to be reimbursed from the incapable person's property. Illustration (b) to section 68 is on these facts.

Application. Suresh is legally bound to maintain his wife and minor children (under his personal law and section 144 of the Bharatiya Nagarik Suraksha Sanhita, 2023). Food grains, clothes and school books are ordinary necessaries; Ramesh must show that the quantities and quality were suited to the family's condition in life and that they were not already supplied from elsewhere. Suresh has property, so there is a fund to satisfy the claim.

Conclusion. Ramesh can recover a reasonable price for the necessaries from Suresh's property under section 68. He cannot obtain a personal decree against Suresh, and nothing beyond necessaries (for example, luxury goods) is recoverable.

7. Persons disqualified by law

The third limb of section 11 excludes persons “disqualified from contracting by any law to which they are subject”. The usual list:

How this is examined

The lunatic's family problem was set in January 2026 and is answered as above, with illustration (b) to section 68 quoted. As a short note: “Who is a person of sound mind?” or “Persons disqualified by law”. In an essay on capacity, this material is usually combined with minors: section 11, then minors, then section 12, then disqualified persons, then section 68 for both.

Now try the real questions: Contract I past question papers.