Molton v Camroux: CEC 2 Jan 1848

The buyer of annuities from a company was of unsound mind. The company had acted in its normal course of business.
Held: The court asked ‘whether the mere fact of unsoundness of mind, which was not apparent, is sufficient to vacate a fair contract executed by the grantee, by payment of the consideration money, and intended bona fide to be executed by the grantor, by payment of the annuity.’ and answered: ‘the modern cases show, that when that state of mind was unknown to the other contracting party, and no advantage was taken of the lunatic, the defence cannot prevail, especially where the contract is not merely executory, but executed in whole or in part, and the parties cannot be restored altogether to their original position.’

(1848) 4 Exch 17
Appeal fromMolton v Camroux CExC 1848
A person of unsound mind bought an annuity from a life assurance society. The society granted the annuities in the ordinary course of its business. The contracts were challenged.
Held: The court referred to the argument that a plea of insanity . .

Cited by:
CitedArcher v Cutler 1980
(New Zealand) The purchaser of land sought specific performance of the contract. The vendor and purchaser had been neighbours. The neighbour needed part of the vendor’s land for access.
Held: A contract made by a person of insufficient mental . .
CitedHart v O’Connor PC 22-Apr-1985
Effect of insanity on making of contract
(New Zealand) The parties disputed the effect in law of an agreement for the sale of land. The transferor had proved not to be of sound mind.
Held: The validity of a contract entered into by a lunatic who is ostensibly sane is to be judged by . .
CitedMcLaughlin v Daily Telegraph Newspaper Co. Ltd 15-Jul-1904
(High Court of Australia) The court considered the law on the effect of mental incapacity on a contract in the two cases Imperial Loan, and Molton v Camroux: ‘The principle of the decision seems, however, to be the same in both cases, which, in our . .

Lists of cited by and citing cases may be incomplete.


Updated: 13 January 2022; Ref: scu.252447