A is the owner of a field. He decides to sell it to B. There is a right of way from the field that only A has knowledge of, but he conceals it from B. Discuss whether the contract can be rescinded by B. What are the cond
CS Executive · Jurisprudence, Interpretation and General Laws · PYQS · December 2024
A is the owner of a field. He decides to sell it to B. There is a right of way from the field that only A has knowledge of, but he conceals it from B. Discuss whether the contract can be rescinded by B. What are the conditions where the court may refuse to rescind the contract ?
Answer & Explanation:
Rescission of Contract: Section 27 of the Specific Relief Act, 1963, deals with when rescission of a contract may be adjudged or refused. 'Rescission' means putting an end to a contract which is still operative and making it null and void ab initio. It does not apply to void contracts. Section 27(1) states that any person interested in a contract may sue to have it rescinded, and such rescission may be adjudged by the court in any of the following cases: Where the contract is voidable or terminable by the plaintiff. Where the contract is unlawful for causes not apparent on its face and the defendant is more to blame than the plaintiff. In the given situation: A, the owner of a field, sells it to B. A conceals a right of way from the field, of which only A has knowledge. Concealment of a material fact, especially one that affects the value or usability of the property, can amount to misrepresentation or fraud, making the contract voidable at the option of the aggrieved party (B in this case) under the Indian Contract Act, 1872. Conclusion: B is entitled to have that contract rescinded as the concealment of facts by A may be covered under misrepresentation or fraud, making the contract voidable. Conditions where the court may refuse to rescind the contract (Section 27(2)): The court may refuse to rescind the contract in the following circumstances: Where the plaintiff has expressly or impliedly ratified the contract. Where, owing to the change of circumstances which has taken place since the making of the contract (not being due to any act of the defendant himself), the parties cannot be substantially restored to the position in which they stood when the contract was made. Where third parties have, during the subsistence of the contract, acquired rights in good faith without notice and for value. Where only a part of the contract is sought to be rescinded and such part is not severable from the rest of the contract. Note: The 'contract' in this section, in relation to territories to which the Transfer of Property Act, 1882, does not extend, means a contract in writing.
Topics: Specific Relief Act, 1963
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