Question 1 (b)
Forged certificate the buyer never looked at: fraud
6 marks
- Time to write
- About 12 minutes
- Topic
- Free consent
- Notes
- Crux notes
Question
Question 1 (b) · 6 marksX intends to sell his horse to Y. X prepared a forged certificate of fitness by a veterinary doctor, the horse being unsound, and put it on the stable's door. Without looking at the certificate on the door of the stable, Y purchased the horse; later he came to learn that horse is not sound. Can the contact be cancelled by Y on the ground of X's fraud. Give reasons.
Reworded from the university paper; the task is the same. The original paper belongs to the University of Delhi. See DU's question bank.
Before you write
Read off the question and its marks
Read from the question
- Give reasonsA case problem: state the rule and its section, apply it to these facts, then answer in one line (yes or no, and why).
Write it in this order
- Read the facts; underline who did what, and the exact question 1 min
- 1 Fraud and its essentials, especially inducement 3 marks 5 min
- 2 Application to the facts 2 marks 4 min
- 3 Decision 1 mark 1 min
- Check: section named, answer stated in one line 1 min
Short on time? Trim steps 1 and 2 evenly rather than skip one: each is capped at its own marks. End with step 3 in a line or two.
Try it first. About 12 minutes for 6 marks. Write it out, then open the solution.
Solution
Hover or tap a marked figure, like 72,000, to see how it is made and where else it appears.
Law. Under section 17 of the Indian Contract Act, 1872, fraud includes the suggestion as a fact of what is not true, active concealment of a fact, and any other act fitted to deceive, done with intent to deceive the other party or to induce him to enter into the contract. A contract is voidable for fraud only if the essential elements are present; among them, the other party must have been induced to act on the representation, must have relied on it and been deceived, and must have suffered loss. A fraud that did not cause the consent of the other party does not make the contract voidable: where a buyer bought shares on a prospectus naming a director he had never heard of, his claim failed because the untrue statement had not induced him.
Application. X prepared a forged certificate of fitness and put it on the stable door, an act fitted to deceive, done with the intent of misleading buyers. But Y bought the horse without looking at the certificate. The forged certificate therefore did not induce Y's consent, and Y was not deceived by it. One essential element of fraud as a ground of avoiding the contract, that the fraud caused the consent, is missing.
Decision. Y cannot cancel the contract on the ground of X's fraud. (This is the principle of the English case Horsfall v. Thomas, where a buyer who never examined a gun could not complain of the concealment of its defect.)
Where the 6 marks sit
| # | Component | Marks |
|---|---|---|
| 1 | Fraud and its essentials, especially inducement | 3 |
| 2 | Application to the facts | 2 |
| 3 | Decision | 1 |
| Total | 6 |
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