Contractual capacity is defined as an ability^[1] or the attribute of persons which enables them to perform civil or juristic acts.^[2] Contractual capacity in ordinary parlance refers to the ability of a person to enter into a contractual relation, without which a contract, although valid ex facie, becomes void or voidable, and unenforceable. 

The introduction of the concept of contractual capacity as a requirement for a valid contract is aimed at protecting certain individuals who the law deems to be at disadvantage for entering into certain contracts. These individuals include Illiterates, Infants, drunkards, and lunatics.

Therefore, the question of whether a person has the capacity to enter into a contract is dependent on two factors; the character of the person entering into the contract, and the type of contract entered or being entered into.

To determine an illiterate’s contractual capacity, one asks if the contract is oral or written. An illiterate has the contractual capacity to freely enter into an oral contract, and such an oral contract holds the same binding force on an illiterate as it does on a literate person.

However, certain laws restrict an illiterate’s contractual capacity for written contracts, favoring the illiterate who may not understand the written document’s content.

In such circumstances, the illiterate may plead that the contractual document fails to comply with the law’s primary requirement and consequently, non est factum.^[3]

The primary legislation which regulates the contractual capacity of an illiterate in entering into a written agreement is the Illiterate Protection Act, which provides in section 2 that :

‘’no person shall write the name of an illiterate by way of signature to any document unless such illiterate shall have first appended his or her mark to it; and any person who so writes the name of the illiterate shall also write on the document his or her own true and full name and address as

witness, and his or her so doing shall imply a statement that he or she wrote the name of the illiterate by way of signature after the illiterate had appended his or her mark, and that he or she was instructed so to write by the illiterate and that prior to the illiterate appending his or her mark, the document was read over and explained to the illiterate. ‘’

Thus, for a written contract to be binding over an illiterate, the contract must;

1. Bare the mark of the illiterate (Signature or Thumbprint)
2. Include the full name and address of the person who writes the name of the illiterate on the contract, such person called the writer,
3. Have been read and explained to the illiterate before he or she appends his mark on the document.

Section 1(b) of the Illiterate Protection Act defines an illiterate as a person who is unable to read and understand the script or language in which the document is written or printed. Oputa J restated this position in Osefor v Uwania.^[4]

Unfortunately, the appeal court in PZ & CO v Gusau and Kantoma^[5] took a different turn when it was held that an illiterate is a person who is not able to read and understand any language. This position contradicts the definition under the act, which mirrors an illiterate in line with the language used in the document. The supreme court in Otitoju v. Governor of Ondo State has however corrected the anomaly created by the appellate court in PZ & Co Supra, and upheld the position under the act. Therefore, a person literate in English language is an illiterate where a contract is drafted in German, provided such person cannot read and understand German.

The burden of proof of illiteracy rests on the party claiming to be illiterate. As the court held in Anaeze v Anyaso,[6] the court should not deem a party illiterate by their mere mien, demeanour, or comportment; instead, it should rely on strict evidence, as anyone could claim illiteracy. However, courts often consider a party who made their mark by thumb impression illiterate, while they should consider a party who signed a document literate. Where a party successfully proves their illiteracy, the burden to prove otherwise shifts to the claimant.

It becomes necessary to define who a writer is under the scope of the act. The act does not define who a writer is, however, as decided in PZ & Co supra and UAC v Edem and Ajayi^[7] it is the person who enters the name and address of the illiterate in the contract. This mirrors the provision of the act which provides that ‘’no person shall write the name of an illiterate by way of signature to any document. Thus, a writer is not necessarily the negotiator of the contract or the person who drafts the contractual document, but the person who finally writes the name of the illiterate as signatory to the document.’’

The obligations of a writer of a contract involving an illiterate person are provided in section 2 of the Illiterate Protection Act as highlighted above. They include;

• The obligation to write his true and full name and address in the contractual document, and
• The obligation to read and explain the content of the document to the illiterate before the illiterate makes his mark.

;

• he or she was instructed to write the document by the person for whom it purports to have been written (The illiterate),
• that it fully and correctly represents the instructions of the illiterate,
• The document was read over and explained to him or her.

Thus, if the illiterate provided no instruction to the writer, or if the writer failed to read and explain the document’s content to the illiterate, the court will deem the document to fail to comply with the Act’s provisions…

Non-compliance with the Illiterate Protection Act’s provision may render the contract void or voidable. although the party trying to enforce the contract usually determines the resulting effect. If the party seeking to enforce the contract is the writer, the law makes the contract void and unenforceable against them.

However, the contract is only voidable at the instance of the illiterate or a third party who has sufficient interest in the contract, who may choose to treat the contract as void or binding.

Thus, the illiterate or a third party may enforce the contract against the writer. In Djukpan case supra, both parties to the contract were illiterates; the court held that either party may enforce the contract against the other. The court in Edokpolo v. Edokpolo expressed the rationale for this: the law does not intend to punish an illiterate for the writer’s default.

Overtime, the provision of the illiterate protection act became an engine of fraud; illiterates began to enter into contractual relationships and refused to perform their contractual obligation on the ground of non-conformity with the act. Thus, there was a need for judicial evolution to limit the application of the act.

The new position asserts that mere non-compliance does not sufficiently make a written contract unenforceable; one must also prove that the person claiming illiteracy does not truly understand the contract’s content at the time of entering it.[9]

Thus, where one proves the defendant understands the contract before making his mark on the contract, the contract remains valid and enforceable.

The Illiterate Protection Act primarily governs an illiterate person’s contractual capacity for written agreements in Nigeria. The Act also stipulates that a written contract with an illiterate only becomes valid and enforceable if the illiterate makes their mark, and a writer witnesses it by adding their name and address.

Furthermore, the writer must read and explain the contract’s content to the illiterate before they make their mark on the document.

The essence of the provision is to protect illiterate persons who may not understand the content of a written contract from the exploitation of other contracting parties who may still decide to use that to a fraudulent advantage. The law provides a strong legal ground of defence for illiterates.

However, while at the early stage, the application of the law was strict and rigid, its application in modern days has become nuanced, giving consideration to understanding of both parties to the contract. This seeks to attain a balance between the protection of vulnerable individuals and the assurance of contractual certainty as well as prevention of fraud.

---

^[1] Black’s law dictionary, 4th ed

^[2]  Sargent v. Burdett, 96 Ga. 111, 22 S.E. 667; 2 Com.Dig. 294.

^[3] This is a latin maxim which means “not my deed.” It is a special defence in contract law which allows a person to avoid certain contractual obligations on the grounds of mistake or fraud.

^[4] (1971) 1 ALR 421

^[5] (1961) All NLR 242

^[6] (1993)5 NWLR (Pt. 291)

^[7] (1958)NRLW pg 33

^[8]  (1996) NWLR 122

^[9] Karibi-Whyte in Anaeze v. Anyaso,  (1993)5 NWLR (Pt. 291)

Lead Partner EKO SOLICITORS AND ADVOCATES