This article is written by El-varith Fahad .AP,3 year student of Markaz law college, Kerala. This article sheds light on the concept of ‘Consensus ad idem’.
Concept of Consensus Ad Idem
Introduction
Indian contract act, 1872 deals with the various kinds of contractual obligations between both parties with each other. In order of contract to be recognized by law as per Indian contract act, some elements are to be satisfied. According to a valid contract, it indicates the willingness of both parties so as to enter in to it on their own accord . In fact, a contract is outcome of the concept of “Consensus And idem” which means ‘agreeing upon the same thing in the same sense’. It refers to the situations where there is a common as well as mutual understanding in the formation of contract. The section provides that parties to the contract are said to consent to something if there is identity of mind of both parties. Formation of the contract is initiated with freely consent of parties, simply because when there is no consent at all, the contract will be treated as void ab initio. It can’t be enforceable even at the option of either party. So it is an essentially required element in order of a contract to be enforceable under Indian contract act.
Consensus as idem
The well-known legal term of ‘consensus as idem’ is derived from Roman law and originated from the fact that contracts will be void unless parties agree upon the same thing in the same sense. This phrase is used with a view to expressing the state of minds of parties that enters into a contract with absolutely presence of mind. It is a common law concept that requires both parties, entering into contract, to have a mutual consent to go on with contract with each other. Consensus as idem in contract law means that meeting of the mind of both parties to the contract on the same thing in the same sense.
Parties are said to have consented when they not only agreed upon the same thing but also agreed upon that thing in the same sense. The term ‘same thing’ must be understood as the whole consent of the agreement. Consequently, when both parties to the contract make some fundamental errors as to the subject matter of the agreement, it can’t be said that there is ‘meeting of mind’ between both parties to the contract and if they do not agree in the same sense, there can’t be a consent. As far as a contract is concerned to, it can’t arise in the absence of consent as it is considered one of the vital element in order for the contract to be valid.
Section 13 under contract act
According to section 13 of Indian contract act, it deals with consent of the parties forming the contract. This section provides that parties are said to consent to something ‘when they agree upon the same thing in the same sense’. If there is no consent at all, the agreement will be Void. It’s not enforceable at the option of the either party .
Illustration :
A has two different houses to be sold. B doesn’t know that A has two houses and offers to buy a house at 10 Lakhs. Here, there is no identity of mind in the respect of the subject matter. Hence, there is no consent at all and the agreement is Void ab initio.
For the formation of a valid contract, there must be free consent. A consent is said to be free when it is not caused by:
- Coercion [section 15]
- Undue influence [section 16]
- Fraud [section 17]
- Misrepresentation [section 18]
- Mistake [section 20,21,22]
Where the consent is caused by coercion, undue influence, fraud and misrepresentation, it becomes voidable at the option of one party whose consent is obtained. whereas in the case of mutual mistakes, it becomes void. So, a consent is said to be free only in the absence of materials mentioned above.
Consent caused by coercion ;
If the consent of one of the parties to the contract, has been obtained by coercion, the consent will not be treated as free consent which is needed to be a valid contract. If the consent has been caused by coercion, the contract will be voidable at the option of the party whose consent has been so obtained.
Section 15 of the Indian contract act, states that ‘Coercion’ is the committing, or threatening to commit, any act forbidden by the indian penal code or the unlawful detaining or threatening to detain any property, with the intention of causing any person to enter into an agreement.
Illustration :
A threatens to hurt B, if B doesn’t sell his bike at the lowest price. Here, this kind of contract will not be considered as valid since B’s consent was obtained through the prohibited way and it will become voidable.
Case law
Chikham Ammiraju V Chikham Seshamma
In the case of Chikham Ammiraju V Chikham Seshamma, the Court upheld that the threat of committing suicide with a view to obtaining the consent of others in any matter, should come within limit of Coercion mentioned under section 15 of Indian contract act, 1872 and the release deed was, therefore, voidable.
Consent caused by Undue influence;
Section 16 of the indian contract act states, that If the consent of party has been caused by undue influence, the contract will be voidable at the option of one party whose consent has been so obtained.
Illustration :
A threatens B to end the relationship with each other unless B enters into a specified contract.
Case law
Takari Devi V Rama Dogra
In Takri Devi V Rama Dogra, an illiterate old lady living separately from her husband gifted practically all her property, which included an apple orchard, valued at Rs 2 lakhs to the done, who was her lawyer. There was no any kind of other relationship between the donor and the done. It was held that there was a fiduciary relation between both of them and contract could be voidable at the option of other party whose consent has been so obtained.
Consent caused by fraud :
The term fraud means that taking representation of facts made willfully with a view to deceiving the other party.
Section 17 says that Fraud means any act committed by a contracting party or with his connivance or by his agent with the wrongful intention of deceiving another party in order to enter into contract. But mere silence to the fact is not fraud.
Illustration :
A sells by auction to B, a house which A knows is about to fall in. but A didn’t disclose it. A has not committed fraud as mere silence does not amount to fraud.
Case law:
Keats V Lord Cadgon
The fact of this case is that, A let his house to B which he knew in ruinous condition. He also knew that the house is going to be occupied By B immediately. A did not disclose the condition of the house to B. In this case, eventually it was held that A had committed no fraud as mere silence is not considered as fraud.
Consent caused by Misrepresentation
Section 18 states that Misrepresentation is when a party asserts something which is not true though he believes is to be true. In other words, misrepresentation is a false representation innocently.
Illustration :
A sells a horse to B, believing that the horse is sound mind and without the awareness of the fact that the horse is unsound. Then he tells B that horse is sound mind. Here, A commits misrepresentation as there is no bad intention.
Case law:
Nottingham Brick and Tile Co V Butler
In this case, the buyer of the land asked the seller’s solicitor as to whether there would be any kind of restrictive covenants on the land, or not?. The solicitor replied him that he was not aware of that. He didn’t say that he had not bothered to read the documents. Eventually Court upheld that the statement was misrepresentation as there were restrictive covenants and the contract could be voidable.
How Misrepresentation differs from fraud;
Both Fraud and Misrepresentation are prima facie false statement. But there is a slight difference between both. In fraud, the false statement is made by a person who knows that it is a false statement or does not believe it to be true, whereas in Misrepresentation the person believes the statement made by him to be true. In addition to that, in fraud the false statement made by a person is with a view to deceiving other party whereas there is no such bad intention in the case of misrepresentation.
Consent caused by Mistake :
The term Mistake is nowhere defined in Indian contract act. Sections 20,21and 22 deal with the concept of Mistake. Mistake may be defined as innocent or erroneous belief which leads party to misunderstand the other party. A contract with mutual mistakes from both parties will be void as there is no meeting of mind of parties.
Illustration :
A offers to sell his flat at Nilambur to B, who believes that A has only one flat at Calicut, agrees to buy the flat. Here, two parties are under mutual mistake of subject matter, so that there is no real consent and the agreement is void.
Case law:
Cundy V Lindsay
It is an English contract law case. In this case, House of lords upheld that contract as mistake as matter of identity will be automatically void.
Conclusion
One of the essentials of a valid contract mentioned under section 10 is that parties should enter into the contract with their free consent. According to section 14 of the Indian contract act, 1872 a consent is said to be free when it is not caused by coercion, undue influence, fraud, misrepresentation and mistake. Here, it can’t be said that there is ‘identity of minds’ of the parties which is a required element in order for a contract to be enforceable, while they enter into the contract. In fact, contract is the product of the ‘ Consensus ad idem’. So if they don’t agree in the same sense, there can’t be consent, it’s because a contract Cannot arise in the absence of free consent.
References;
INDIAN CONTRACT ACT BY Dr. R.K Bangia
INDIAN CONTRACT ACT BY Narendar kumar
34 Ind Cas 578, [1917] 32 MLJ 494
https;//blog.ipleaders.in
Author: FAHAD Ap,
Markaz law college