Disqualified Persons: A person who is expressly declared to be disqualified by law is also incompetent to contract due to certain specified reasons. A person does not have contractual capacity neither because of their minority nor the unsoundness mind but the law makes them as disqualified and incapable as a result of their special status, position, circumstances and responsibilities. Disqualified persons can enter into contracts but with certain limitations. If they make contract beyond limitations such contract becomes void and therefore cannot be enforced in the court of law. The persons, who are supposed to be disqualified by law to make contracts are: -
(1) Alien enemy: Alien is a
citizen of a foreign country. Every citizen is free to make contract with
aliens except some restricted items by the government. But on the declaration
of war between two countries, alien becomes alien enemy and he cannot enter
into contract. Contracts entered into before the declaration of the war stand
suspended and cannot be performed during the course of war but they can be
revived after the war is over.
(2) Insolvent: A person or
a company who is declared bankrupt by the court due to unbearable loss that he
has suffered in business is called insolvent person or company. An insolvent
person is disqualified by law to make contracts, because he has no capacity to
fulfil his contractual liability. A contract made with an insolvent person
or company is totally void.
3)
Foreign sovereigns:
Foreign government, foreign ambassadors,
diplomatic persons working in foreign ambassy fall under the category of
foreign sovereigns. Foreign sovereigns can enjoy diplomatic privileges
hence the citizen of a country should not enter into contracts with them,
because the court of a country can’t order them to perform a contract. Therefore,
a contract with foreign sovereign has no legal effect.
(4)
Corporation:
A corporation or a joint stock company is an artificial person. Being
artificial person, it can operate transaction in its own name. But the
corporation should make contracts. with the third party within the limitations
as fixed by law. If a contract is made by a corporation or company
beyond the limitation mentioned in its memorandum or articles of association or
beyond the authority allowed by law, it becomes void.
(5)
Professionals:
Professional persons like lawyer, professor, doctors, engineers can make contracts
with any person for their fees and remuneration. If a person/ client, fails to
pay the fees and remuneration to the above professional persons they can sue
against their client in the law court. But in Britain, professional people such
as members of Royal College of Physicians and attorneys are not allowed to sue
for their fees or service charges. Hence, for their fees and service charges,
they cannot enter into any contract.
(6) Married Women:
A married woman has right to sell and purchase movable properties in her own
name. She can represent her husband in dealings with the third parties or
persons. But so far as the sale of her immovable property is concerned, she cannot
sell her family property or donate it without taking the permission of her husband.
In absence of her husband, she should take the consent of her adult sons.
Hence, she cannot enter into any contract with third parties for selling immovable
property without getting consent from her husband or adult sons.
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