§ SECTION 114 · BSA 2023 · CHAPTER VII — BURDEN OF PROOF

Proof of good faith in transactions where one party is in relation of active confidence

Where trust can be abused, the trusted party must prove fair dealing. When the good faith of a transaction is questioned, and one party stands to the other in a position of active confidence, the burden of proving good faith is on the party in whom the confidence is reposed.

How to read Section 114

A relationship of active confidence → the deal’s good faith is questioned → the trusted party must prove it was fair.

The relationship

One party stands to the other in a position of active confidence — trust and reliance.

Good faith questioned

A transaction between them is challenged as not in good faith.

The trusted party proves

The party in the position of active confidence must prove the transaction’s good faith.

The bare Act

The section in its own words — the rule and two illustrations.

Section 114 · verbatim

Where there is a question as to the good faith of a transaction between parties, one of whom stands to the other in a position of active confidence, the burden of proving the good faith of the transaction is on the party who is in a position of active confidence.

Illustrations

(a) The good faith of a sale by a client to an advocate is in question in a suit brought by the client. The burden of proving the good faith of the transaction is on the advocate.

(b) The good faith of a sale by a son just come of age to a father is in question in a suit brought by the son. The burden of proving the good faith of the transaction is on the father.

In short: in some relationships one person naturally trusts and relies on another — a client on an advocate, a young adult on a parent, a patient on a doctor, a beneficiary on a trustee. That trusted, dominant party could easily turn a dealing to his own advantage. So when the good faith of such a transaction is challenged, the law does not make the weaker party prove unfairness; it puts the burden on the party who held the confidence to show the deal was fair, open and honest. The onus follows the power to abuse — whoever was trusted must justify the transaction.

→ This carries forward IEA 1872 § 111 — good faith in dealings of active confidence.

Glossary

good faith

Honesty and fairness — no undue influence, concealment or advantage-taking.

active confidence

A relationship where one party reposes trust in and relies on the other.

transaction between parties

A dealing — a sale, gift or the like — between the two.

the party…in a position of active confidence

The trusted, dominant party (advocate, parent, trustee).

advocate & client

The advocate holds the client’s confidence.

son just come of age

Newly an adult, still under a parent’s influence.

The picture

The onus follows the power to abuse — the trusted party must justify the deal.

The section, part by part

Tap a part — the picture-story tells it first; the word-by-word text and example follow.

The ruleThe two illustrations

the ruleThe trusted party must justify the deal

In one lineWhere a party stands in a position of active confidence and the good faith of a transaction between them is questioned, the burden of proving good faith is on the trusted party.

Where there is a question as to the good faith of a transaction between parties, one of whom stands to the other in a position of active confidence,a deal where one party held the other’s confidence…the fairness of a dealing is challenged, and one side stood in a trusted, dominant position over the other…

the burden of proving the good faith of the transaction is on the party who is in a position of active confidence.→ the trusted party must prove good faith…so the party who held the confidence must show the deal was fair, open and honest.

ExampleA trustee buys property from his beneficiary, and the sale is later challenged. It is the trustee — the party trusted — who must prove the transaction was in good faith.

✗ Not thisThis does not assume fraud. It simply puts the burden of showing fairness on the party who could abuse the trust — not on the weaker party to prove unfairness.

the two illustrationsAdvocate over client · father over son — the dominant proves

In one line(a) A client sells to his advocate — the advocate proves good faith; (b) a son just of age sells to his father — the father proves good faith.

(a) The good faith of a sale by a client to an advocate is in question in a suit brought by the client. The burden of proving the good faith of the transaction is on the advocate.(a) client → advocate: advocate provesthe client trusted the advocate; so the advocate must prove the sale was in good faith.

(b) The good faith of a sale by a son just come of age to a father is in question in a suit brought by the son. The burden of proving the good faith of the transaction is on the father.(b) son → father: father provesthe young son was under the father’s influence; so the father must prove the sale was in good faith.

ExampleIn both, the dominant party (advocate, father) carries the burden — even though it is the weaker party (client, son) who brought the suit.

✗ Not thisWho filed the suit does not decide the burden. It falls on the party in the position of active confidence, because that is the party who could have taken advantage.

Connected provisions

§ 113 · back

IEA 1872, § 111

Carried forward — good faith in dealings of active confidence.

Bharatiya Sakshya Adhiniyam, 2023 — Section 114: Proof of good faith in transactions where one party is in relation of active confidence