CAPACITY OF PARTIES

For a valid contract, the parties to a contract must have capacity i.e. competence to enter into a contract. Every person is presumed to have capacity to contract but there are certain persons whose age, condition or status renders them incapable of binding themselves by a contract. Incapacity must be proved by the party claiming the benefit of it and until proved the ordinary presumptions remains.



Section 11 of the Contract Act deals with the competency of parties and provides that "every person is competent to contract who is of the age of majority according to the law to which he is subject, and who is of sound mind and is not disqualified from disqualified from contracting by any law to which he is subject."

It follow that the following person are incompetent to contract. (a) minor (b) person of unsound mind, and (c) Person disqualified by any law to which they are subject. Contract entered into by the persons mentioned above are void.

Every person is competent to contract: (a) Who is of the age of majority. (b) Who is of sound mind. (c) Who is not disqualified from making a contract.

Therefore the following persons are not competent to contract (a) A person who is a minor.

(b) A person of unsound mind.

(c) A person who is disqualified from making a contract.