Literal Meaning
Necessity has no law.
Explanation
Necessitas non habet legem is an old age maxim which means necessity knows no law. A person may sometimes have to succumb to the pressure of other party to the bargain who is on a stronger position. This kind of bargain can be referred to as bargain under undue influence.
Illustration
In a car sale deal between Employer and Employee, the employee has to agree to the price decided by the employer. The reason behind this is the stronger position of the employer in the bargain.
Indian Law Position:
These kinds of bargains where one person is in stronger position and is able to influence the will of the other party can be called as bargain under ‘undue influence’. The Indian Contract Act provides that these kinds of agreements are void. Section 16 of the Indian Contract Act defines Undue Influence as follows –
“”Undue influence” defined
(1) A contract is said to be induced by “undue influence” where the relations subsisting between the parties are such that one of the parties is in a position to dominate the will of the other and uses that position to obtain an unfair advantage over the other.
(2) In particular and without prejudice to the generality of the foregoing principle, a person is deemed to be in a position to dominate the will of another-
(a) Where he holds a real or apparent authority over the other, or where he stands in a fiduciary relation to the other; or
(b) Where he makes a contract with a person whose mental capacity is temporarily or permanently affected by reason of age, illness, or mental or bodily distress.
(3) Where a person who is in a position to dominate the will of another, enters into a contract with him, and the transaction appears, on the face of it or on the evidence adduced, to be unconscionable, the burden of proving that such contract was not induced by undue influence shall lie upon the person in a position to dominate the will of the other.
Nothing in this sub-section shall affect the provisions of section 111 of the Indian Evidence Act, 1872 (1 of 1872).”[1]
Case Referred
Mannu Singh v. Umadat Pande
A guru influenced his disciple to take his property in gift by promising to secure benefits to him in the next world. The court set the gift aside as it was not formed with free consent. In this case Section 14 of the Indian Contract Act was referred by the court. [2]
Inder Singh v. Dayal Singh
Section 14 of the Indian Penal Code was also considered by the court in this case.
Central Inland Water Transport Corporation Limited v. Brojo Nath Ganguly
In this case the Supreme Court of India provide the follow –
“A contract which was entered between the parties who are not at the same footing in their bargaining power will be not enforced by the court”.[3]
Edited by Vigneshwar Ramasubramania
Approved & Published – Sakshi Raje
[1] Indian Contract Act 1872, s. 14.
[2] Mannu Singh v. Umadat Pande, Appeal No. 34 of 1889.
[3] Central Inland Water Transport Corporation Limited v. Brojo Nath Ganguly, 1986 AIR 1571.
