Authored By: Urishita Gadhok
1. Case Title & Citation
Case Title: Mohori Bibee v. Dharmodas Ghose
Citation: (1903) 30 Cal 539 (Privy Council); AIR 1903 PC 1
2. Court Name & Bench
Court: Judicial Committee of the Privy Council (then the highest appellate authority for India)
Bench: Lord Macnaghten, Lord Lindley, Sir Ford North, Sir Andrew Scoble, Sir Arthur Wilson
3. Date of Judgment
Date: 4 March 1903
4. Parties Involved
Appellant: Mohori Bibee, widow of the attorney of moneylender Brahmo Dutt, who sought to enforce the mortgage against the minor.
Respondent: Dharmodas Ghose, a minor who executed a mortgage deed during his minority.
5. Facts of the Case
Dharmodas Ghose, while still a minor, executed a mortgage deed of his immovable property in favour of Brahmo Dutt, a moneylender, to secure a loan of ₹20,000.
His mother, as guardian, informed Brahmo Dutt’s attorney of the fact of minority on the very day of the mortgage execution.
Despite knowledge of this, the attorney went ahead with the transaction.
Dharmodas filed a suit (through his mother) seeking to have the mortgage declared void.
The Calcutta High Court ruled in favour of the minor, and the case was appealed to the Privy Council.
6. Issues Raised
- Is a contract entered into by a minor under the Indian Contract Act, 1872 valid, voidable, or void ab initio?
- Does Section 65 of the Indian Contract Act, 1872 (restoration of benefits under void agreements) apply to contracts with minors?
- Can equitable doctrines (restitution, unjust enrichment) be used to bind a minor despite statutory protection?
7. Relevant Statutory Provisions
Section 10, Indian Contract Act, 1872:
“All agreements are contracts if they are made by the free consent of parties competent to contract, for a lawful consideration and with a lawful object, and are not hereby expressly declared to be void.”
Section 11, Indian Contract Act, 1872:
“Every person is competent to contract who is of the age of majority according to the law to which he is subject, and who is of sound mind, and is not disqualified from contracting by any law to which he is subject.”
Section 65, Indian Contract Act, 1872:
“When an agreement is discovered to be void, or when a contract becomes void, any person who has received any advantage under such agreement or contract is bound to restore it, or to make compensation for it, to the person from whom he received it.”
8. Arguments of the Parties
Appellant (Mohori Bibee on behalf of Brahmo Dutt):
– Asserted that even if the mortgage was void, Section 65 should apply, compelling Dharmodas to return the benefit received.
– Emphasised that equity demanded repayment to prevent unjust enrichment.
Respondent (Dharmodas Ghose):
– Invoked Section 11, claiming that as a minor he was not competent to contract, rendering the mortgage void ab initio.
– Since the lender’s agent knowingly contracted with a minor, no equitable relief could be granted.
9. Judgment / Final Decision
The Privy Council dismissed the appeal and held:
– A contract with a minor is absolutely void from the very beginning.
– Section 65 is inapplicable, as it presupposes an agreement between competent parties; since a minor cannot contract, the agreement never existed in law.
– The mortgage was unenforceable and invalid.
10. Legal Reasoning / Ratio Decidendi
Section 11 of the Contract Act makes minority a statutory incapacity; thus, contracts with minors are a nullity.
Section 65 did not apply because it requires a valid agreement that subsequently becomes void, not an agreement void from inception.
The Court refused to apply equity against statutory provisions — holding that no restitution can be compelled when both parties were aware of minority.
11. Obiter Dicta
The Privy Council noted that if contracts with minors were treated as only voidable, it would expose minors to exploitation, defeating the protective intent of the legislature.
They observed that equitable principles cannot be used to indirectly enforce what is directly prohibited by statute.
The judgment clarified that the protection afforded to minors is absolute, and not subject to exceptions based on fairness or enrichment.
The Court hinted that while restitution may apply in some cases, it could not apply when the other party knowingly contracted with a minor.
12. Conclusion / Observations
Significance: This landmark case settled the principle that a minor’s agreement is void ab initio under Indian law.
It ensures that minors cannot be held liable in contract, even if they have received benefits, thereby prioritising their protection.
Practical impact: Creditors and moneylenders were warned against contracting with minors at their own risk.
Critical Note: Although protective, the ruling also creates hardship for innocent third parties, but the Privy Council chose to uphold statutory clarity over equitable flexibility.
