Mohori Bibee v. Dharmodas Ghosh 1903 (Case Summary)

This landmark judgment by the Privy Council established the principle that a minor’s contract is void ab initio under Indian law, reinforcing the legal protection of minors against contractual liabilities.

Facts of Mohori Bibee v Dharmodas Ghosh 

1. Dharmodas Ghosh, the respondent, was a minor who mortgaged his property to the appellant’s husband to secure a loan of ₹20,000.
2. At the time of the transaction, the appellant’s husband was aware that Dharmodas was a minor.
3. Dharmodas later sought to have the mortgage deed declared void, arguing that he lacked the legal capacity to enter into a contract.
4. The appellant contended that the minor, having benefited from the contract, should restore the loan amount as restitution.

Issues framed

1. Whether a contract entered into by a minor void or voidable under Indian law?
2. Whether the principle of restitution be applied to compel a minor to return benefits derived from a void contract?

Judgment of Mohori Bibee v  Dharmodas Ghosh

The Privy Council applied Sections 10 and 11 of the Indian Contract Act, 1872, which require a person to be of sound mind and of the age of majority to enter into a valid contract.

The Court held that under Section 11, a minor is not competent to contract, and therefore, any agreement entered into by a minor is void ab initio (from the beginning). It rejected the appellant’s argument for restitution, emphasizing that imposing such a requirement on a minor would indirectly enforce a void contract, undermining the legal protection provided to minors. The Court clarified that minors are shielded from contractual liabilities, even if the other party suffers losses.

The Privy Council declared the mortgage deed void and ruled in favor of the minor defendant.