Skip to content

CMA Foundation · Fundamentals of Business Laws and Business Communication · Capacity of Parties, Free Consent

Mohan, normally a sane businessman, was so heavily drunk at a party that he could not understand the terms of an agreement he signed with Sunil to sell his shop. What is the legal position?

Mohan cannot make a valid contract while his drunkenness lasts. A person usually of sound mind but temporarily unable to understand the terms or judge their effect on his interests is incapable of contracting during that period, as the Act's illustration on drunkenness shows.

  1. AMohan can contract because he is usually of sound mind
  2. BMohan cannot contract while the drunkenness lasts, as he cannot understand the terms or judge their effectCorrect
  3. CThe contract is valid because voluntary drunkenness is no excuse
  4. DThe contract is valid if Sunil was unaware of the drunkenness

Explanation

A person usually of sound mind but occasionally of unsound mind may not contract when of unsound mind. The Act's illustration states a sane man so drunk that he cannot understand the terms cannot contract while the drunkenness lasts. The first option ignores the condition at the time of contracting.

Did you get it right without looking?

One question tells you little. A timed set on Capacity of Parties, Free Consent shows your real accuracy, how long you take and where you lose marks.

Practise Capacity of Parties, Free ConsentFree diagnostic mock

More Capacity of Parties, Free Consent questions