Coercion

In one line

Coercion is getting someone's agreement by doing or threatening something the criminal law forbids, or by unlawfully holding on to their property.

In the words a student can write in an exam: section 15 of the Indian Contract Act 1872 defines coercion as "the committing, or threatening to commit, any act forbidden by the Indian Penal Code, or the unlawful detaining, or threatening to detain, any property, to the prejudice of any person whatever, with the intention of causing any person to enter into an agreement." The Explanation adds that it is immaterial whether the Penal Code is or is not in force in the place where the coercion is employed, and consent so caused makes the contract voidable at the option of the party coerced under section 19.

Why the law has this at all

An agreement extracted at knifepoint is still, in a bare sense, an agreement: a proposal was made and accepted. What is missing is not the form of consent but its reality.

The law could simply say that consent must be voluntary and leave courts to judge each case. The Act instead defines coercion by reference to an external and objective standard: the criminal law. If what was done or threatened is an offence, it is coercion; if it is not, it is not, whatever pressure it applied.

That has a cost and a benefit. The cost is that some very severe economic pressure falls outside section 15. The benefit is certainty: a party knows in advance where the line is, and a court is not asked to grade the acceptability of commercial hard bargaining. Where the pressure is severe but lawful, the answer, if there is one, lies in section 16 or in section 23, not here.

The provision itself

"'Coercion' is the committing, or threatening to commit, any act forbidden by the Indian Penal Code, or the unlawful detaining, or threatening to detain, any property, to the prejudice of any person whatever, with the intention of causing any person to enter into an agreement.

Explanation. It is immaterial whether the Indian Penal Code is or is not in force in the place where the coercion is employed."

The Act's illustration:

"A, on board an English ship on the high seas, causes B to enter into an agreement by an act amounting to criminal intimidation under the Indian Penal Code. A afterwards sues B for breach of contract at Calcutta. A has employed coercion, although his act is not an offence by the law of England, and although section 506 of the Indian Penal Code was not in force at the time when or place where the act was done."