As described in Section 13 of the Indian contract act, when a mutual understanding between two parties gets established in order to satisfy particular planning, can be termed as consent. People often get confused between consent and free of consent.
Consent is a contract between two or more parties to agree with a mutual commitment to achieve a desire or any other. Free consent in business law helps to understand all the legal rules which we need to follow in business.
What is Free Consent?
Let us define free consent as a contract based on Section 13 of the Indian contract act 1872 is, the meaning of free consent is an agreement made between two parties for the same purpose with the Union of thoughts. It is under the principle of consensus-ad-idem. It is the definition of free consent.
Free Consent Example
In order to understand more clearly, let us illustrate a case of free consent. Let us assume A and B are two parties, and 'A' had some financial crisis, so he wants to make a contract. After knowing all the information and after analyzing the situation, 'B' wants to accept the contract made by 'A'. Here the contract or agreement is made with the mutual consent of both the parties. This is nothing but the free consent of the contract.
Consent and Free Consent
Even though the meaning of both consent and free consent seems to be similar, slight differences are observed when we go through them in detail. Now we will see the differences between consent and free consent, where it varies and the importances etc. in detail as follows-
Elements:- The elements of consent are limited to a similar purpose as well as the same sense of mind. On the other hand, the elements of free consent should be free from fraud, coercion, undue influence, misrepresentations, and other mistakes too.
Void: The contract will be voidable if there is no consent. In contrast, the voidability of the contract will be decided by the aggrieved party in the absence of free consent.
Violating Factors of Free Consent
We have various factors that affect free consent, and it relates to the voidability of the contract. So both the parties participating in your contract should be aware of these factors and should be cautious for a free flow of the contract till it's the due date.
Consent is only considered as a mutual relationship between two parties whereas free of consent includes a mutual understanding as well as it's free from
Coercion: when a person unlawfully, threatens or forces a person via some forbidden acts, leads to coercion. It means the entry of either of the parties might be forceful or any of them committed to illegal activities or commitments against the Indian penal code etc. The effect of coercion leads to the cancellation of the entire contract after investigating thoroughly. The legal body will restrict the obligations of both parties in this case. If the commitment is done forcefully, clearly we can say that it is not free of consent.
Fraud: Another important factor of free consent is fraud. When a person provides false assertion, makes any promises in order to deceive a person or plans to get an advantage over the other party, then the act is considered as fraud. It involves the omission of promises made during the agreement, the false assertion of facts, false actions to cheat the other party, etc. and many more deceiving actions come under this fraud. According to Section 17 of the Indian law of contract, the other party has been given rights to claim for the deceived amounts as well as to revoke the entire contract and can make modifications where he got damaged.
Misinterpretation: Providing a false assertion or fake representation of the fact to the party or making unwarranted information to mislead the other party. According to Section 18 of the Indian law of contract, the misrepresentation is nothing but showing the false information at the beginning of the contract itself. The facts which are committed at the ground level may not be reliable, then it is considered as misrepresentation of the contract. Again here we have two kinds of misrepresentations-one is innocent misrepresentation and the other is a negligent misrepresentation.
Undue influence: when one of the parties has a dominating nature or uses its power to work against the will of the other party. Undue influence is another factor to violate free consent. It occurs when one of the other parties dominates the other party in any aspect. There is a chance of taking unfair advantage because of their dominating position on the other party. The principal behind undue influence is the doctrine of equity. The effect of undue influence leads to the voidability of the contract of free consent under Section 19 A. It requires valid proof to file a case on the dominating party. Generally, the undue influence affects the below parties -
Mistake: Mistakes can have so many impacts and it causes a lot of issues. It can be mutual or individual or can be of many types.
Pros and Cons of Free Consent
Pros of free consent: Free consent is considered as more reliable and flexible. The most important criteria the free consent satisfy can be listed below:
The contract made according to free of consent provides proper protection to the validity enforceability of an agreement.
It acts as a major protecting shield to the parties from various unavoidable circumstances.
It plays a major role to withstand the autonomous power and providing an unbreakable foundation to the running policy or principle.
Cons of free of consent: Although having a lot of advantages, free of consent also contains some kinds of mistakes too. These includes:
Unilateral mistake: when one side party makes a particular mistake, then it is termed a unilateral mistake.
Bilateral mistake: As the name suggests, when both the parties get involved in mistakes, then it is termed a bilateral mistake. This can be further classified into two types:
Mutual mistake: A mistake is said to be mutual when both parties misunderstood each other's policy forming a void, then it is termed as a mutual mistake.
Common mistake: Avoid that arises due to a common mistake in the contract is termed a common mistake. But this mistake is not mutual and is done individually.