In Indian contract law, coercion refers to compelling a party to enter into an agreement through unlawful means, thereby undermining free consent. Understanding coercion is crucial for law students, as it affects the validity of contracts and the rights of the parties involved.
MEANING, DEFINITION & EXPLANATION
Section 15 of the Indian Contract Act, 1872, defines coercion as “committing, or threatening to commit, any act forbidden by the Indian Penal Code (45 of 1860), or the unlawful detaining, or threatening to detain, any property, to the prejudice of any person whatever, with the intention of causing any person to enter into an agreement.”
This definition encompasses:
- Acts forbidden by the Indian Penal Code.
- Unlawful detaining or threatening to detain property.
- Intention to induce a person to enter into an agreement.
For example, if ‘A’ threatens to harm ‘B’ unless ‘B’ signs a contract, ‘A’ is employing coercion.
ESSENTIALS OF COERCION
For an act to constitute coercion under Section 15, the following elements must be present:
- Commitment or Threat of an Unlawful Act: The act committed or threatened must be prohibited by the Indian Penal Code.
- Unlawful Detention or Threat to Detain Property: Detaining or threatening to detain property unlawfully to force someone into an agreement.
- Intention: The act must be done with the intent to compel someone to enter into a contract.
LEGAL PROVISIONS AND EFFECTS
Under Section 19 of the Indian Contract Act, a contract induced by coercion is voidable at the option of the party whose consent was obtained through coercion. This means the aggrieved party can choose to either:
- Rescind the contract, rendering it void.
- Affirm the contract, making it binding.
If the aggrieved party decides to rescind the contract, they must restore any benefit received under the contract to the other party, as per Section 64 of the Act.
CASE LAWS ILLUSTRATING COERCION
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Chikham Ammiraju v. Chikham Seshamma (1918): In this case, the defendant threatened to commit suicide if his wife and son did not execute a release deed in his favor. The court held that the threat of suicide amounted to coercion under Section 15 of the Indian Contract Act, making the release deed voidable.
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Ranganayakamma v. Alwar Setti (1889): A young widow was forced to adopt a boy by her relatives, who refused to allow her husband’s funeral rites unless she consented. The court held that her consent was obtained under coercion, rendering the adoption invalid.
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Bansraj v. Secretary of State for India (1939): The government detained the plaintiff’s property to recover a fine imposed on his son. The plaintiff paid the fine to release the property and later sued for recovery of the amount, claiming coercion. The court held that the payment was made under coercion, and the plaintiff was entitled to recover the amount.
COMPARISON WITH DURESS IN ENGLISH LAW
While Indian law uses the term ‘coercion,’ English law refers to ‘duress.’ Key differences include:
- Scope: Coercion under Indian law includes acts forbidden by the Indian Penal Code and unlawful detention of property, whereas duress in English law traditionally covers threats of physical harm.
- Third-Party Acts: In Indian law, coercion can involve acts by third parties, while English law typically requires the coercive act to be by a contracting party.
DISTINCTION BETWEEN COERCION AND UNDUE INFLUENCE
Both coercion and undue influence vitiate free consent, but they differ:
- Coercion: Involves physical force or threats, making the consent involuntary.
- Undue Influence: Involves mental or moral pressure, where one party abuses a position of power over another.
For instance, in Ladli Prasad Jaiswal v. Karnal Distillery Co. Ltd. (1963), the Supreme Court held that a contract was induced by undue influence where a party in a dominant position obtained an unfair advantage.
BURDEN OF PROOF
The burden of proving coercion lies on the party alleging it. They must demonstrate that their consent was obtained through coercion, as defined under Section 15.
COERCION UNDER SECTION 72
Section 72 of the Indian Contract Act states that a person to whom money has been paid or anything delivered by mistake or under coercion must repay or return it. The term ‘coercion’ here is interpreted in its general sense and not strictly as defined in Section 15.
INTERNATIONAL PERSPECTIVE
Internationally, the concept similar to coercion is ‘duress.’ For example, under English law, duress includes threats to personal safety, property, or economic interests, which compel a party to enter into a contract. The principles are broadly similar, aiming to ensure that consent to a contract is freely given.
CONCLUSION
Understanding coercion is vital for law students, as it directly impacts the validity of contracts. Recognizing the elements of coercion and distinguishing it from related concepts like undue influence ensures a comprehensive grasp of contract law principles.
REFERENCES
- Chikham Ammiraju v. Chikham Seshamma, AIR 1918 Mad 414.
- Ranganayakamma v. Alwar Setti, ILR 13 Mad 214 (1889).
- Bansraj v. Secretary of State for India, AIR 1939 All 373.