Direction: Read the given passage carefully and answer the questions that follow:
An agreement without free consent can be enforced only at the option of the party whose consent was not free.
Where one of the parties to a contract was in a position to dominate the decision of the other party, the contract is enforceable only at the option of the party who was in a position to dominate the decision of the other party.
It is a case of fraud where a party to a contract knows or believes a fact to be true, but conceals it actively from the other party with a view to inducing that person to enter into the contract.
Mere silence as to facts likely to affect the decision of a person to enter into a contract is not a fraud.
When consent to an agreement is caused by coercion, undue influence, fraud, or misrepresentation, the agreement is a contract voidable (rescindable or terminable) at the option of the party whose consent was so caused.
Knowingly making a false statement to a person with an intention to deceive him into entering into a contract constitutes fraud. Making a false statement while believing it to be true constitutes misrepresentation.
Whosoever commits any act forbidden by the Indian Penal code with a view to obtaining the consent of any person to enter into an agreement, he cannot get the agreement enforced by law but the person whose consent has been so obtained may get the agreement enforced by law. The Indian Penal code defines various offenses and prescribes punishments thereof.
Mere silence as to the facts likely to affect the willingness of a person to enter into a contract is not a fraud, unless the circumstances of the case are such that, on close examination it is found to be the duty of the person keeping silent to speak, or unless his silence is, in itself, equivalent to speech.
The act of using threats to force another person to enter into a contract is called coercion. In order to prove coercion, the existence of the use of threat, in any form and manner, is necessary. If coercion is proved, the person who has been so threatened can refuse to abide by the contract.