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

Ramesh, a doctor, attends Mr. Iyer, an elderly patient weakened by a serious illness. Using his influence as the medical attendant, Ramesh induces Iyer to agree to pay him an unreasonably large sum for his services. What is the legal position?

The contract is voidable at Iyer's option. Ramesh, as medical attendant, dominated the will of a weakened elderly patient and used that position to obtain an unreasonable fee. Consent caused by undue influence makes the agreement voidable at the option of the affected party under Section 19A.

  1. AThe contract is void ab initio and no court order is needed
  2. BThe contract is valid because Iyer signed it willingly
  3. CThe contract is voidable at Iyer's option because it was induced by undue influenceCorrect
  4. DThe contract is voidable at Ramesh's option

Explanation

Section 16(2)(b) and the illustration on a medical attendant show that a person dealing with someone whose mental capacity is affected by age, illness or distress is in a position to dominate. Under Section 19A such a contract is voidable at the option of the party whose consent was so caused, here Iyer. It is not void, and the option is not Ramesh's.

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