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Effects of undue influence

  • The effect of transactions entered into due to application of undue influence are covered in sec 19A
    • When consent to an agreement is caused by undue influence, the contract is voidable at the option of the aggrieved party
    • Contract may be cancelled by the Court or the court may form a new contract with revised terms and conditions
Example

A, a moneylender, advances ₹ 10,000 to B, an agriculturist, and by undue influence, induces B to execute a bond for ₹ 20,000 with interest at 6 per cent per month. The court may set the bond aside ordering B to repay ₹ 10,000 with such interest as may seem just.





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