Capacity to Contract

Section 11 states that every person is competent to contract who is (a) of the age of majority according to the law to which he is subject, (b) of sound mind, and (c) not disqualified from contracting by any law to which he is subject.

Persons not competent to contract:

• Minors (below 18 years of age in general, 21 if a guardian of their person/property has been appointed by a court) — an agreement with a minor is void ab initio (void from the very beginning), not merely voidable; a minor cannot be made liable even for necessaries supplied to him, though the supplier can recover the price of necessaries from the minor's property, if any.
• Persons of unsound mind — a person is of sound mind for a purpose if they are capable of understanding the contract and forming a rational judgement of its effect on their interests at the time of contracting; a person who is usually of unsound mind but occasionally sound may contract during a lucid interval, and a person usually of sound mind but occasionally unsound may not contract when actually unsound (e.g. an intoxicated person, a person of unsound mind by mental illness). …