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LAS204 - Contracts > Capacity - Ch. 7 > Flashcards

Capacity - Ch. 7 Flashcards

1
Q

make a contract void

A

avoid (dissafirm)

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2
Q

3 people who are given special protection from contract mistakes in the form of a right to avoid the contract

A
  1. minors
  2. mentally incompetent
  3. some people under influence of intoxicating substances
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3
Q

a person who has not reaced adult status, typically the day before his/her eighteenth birthday

A

minor

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4
Q

the age of adult status (typically 18)

A

majority

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5
Q

a minor, at common law–under 21

A

infant

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6
Q

A (1) or his/her (2) or (3) typically has the power to acoid a contract, while the adult does not have the same power.

A
  1. minor
  2. guardian
  3. administrator
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7
Q

individual with legal responsibility for a minor

A

guardian

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8
Q

responsible for settling a person’s financial affairs after death

A

administrator (executor)

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9
Q

If a minor acts as an agent for the benefit of an adult, the (1) is party to the contract.

A

adult

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10
Q

one who is authorized to act for or in place of another; representative

A

agent

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11
Q

things indispensable to life; reasonably needed for subsistence, health, comfort, and education, considering the person’s age, station in life, and medical condition

A

necessities

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12
Q

A minor can have liability under contracts for (1) under a theory similar to (2)

A
  1. necessities

2. quasi-contract (quantum meruit)

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13
Q

In some states, (1), (2) or (3) may either give a minor capacity or make the minor liable for more necessities.

A
  1. marriage
  2. enlistment
  3. emancipation
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14
Q

minor is no longer under care/control of an adult

A

emancipation

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15
Q

If a minor improperly avoids a contract, courts are forgiving with minors as (1) and harsh with them as (2). Many courtrs require return of (3) but do not require (4). A minor may also not avoid a contract to (5).

A
  1. defendants
  2. plaintiffs
  3. consideration
  4. restitution (e.g., if minor crashes a car, dealer is out of luck)
  5. improve his position
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16
Q

return of, restoration of, or compensation for

A

restitution

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17
Q

false statement regarding a material fact, intended to deceive an indisivual who reaosnable relies on the statement

A

fraud

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18
Q

In most states a minor can (1) despite misrepresentation but may have to pay (2), especially since minors are liable for (3).

A
  1. disaffirm
  2. restitution
  3. torts
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19
Q

A minor has no power to (1) a contract; after majority, the person can give (2) or (3) ratification stating he will not disaffirm the contract.

A
  1. ratify
  2. express
  3. implied
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20
Q

to acknowledge or validate a contract after its execution

A

ratify

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21
Q

to state or write intent to honor a contract or, if the contract has been executed, to acknowledge the contract

A

express ratification

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22
Q

intent to honor contract or acknowledgment of contract can be inferred from behavior or words (continue using property/service, fail to timely disaffirm)

A

implied ratification

23
Q

A parents’ waiver to his child’s injury is likely (1) as an (2)

A
  1. unenforceable (ineffective)

2. exculpatory clause

24
Q

mental incompetence determined by inability to understand the nature and consequences of a transaction

A

cognitive test

25
Q

mental incompetence shown by inability to act reasonable with respect to a transaction (courts generally consider whether other person was aware of the mental condition)

A

volitional test

26
Q

court has declared a person incompetent

A

adjudicated incompetent

27
Q

incompetence has not been determined by a court (courts look at necessity and state of mind)(may have to make restitution if other person didn’t know)

A

non-adjudicated incompetent

28
Q

Like minors, incompetents are liable for reasonable value of (1) and are capable of (2) when competent.

A
  1. necessities

2. ratifying contracts

29
Q

with no legal effect from the outset (e.g. contracts made by adjudicated incompetents)

A

void

30
Q

under the influence of alcohol or drugs

A

intoxicated

31
Q

When looking at whether an intoxicated person entered into a contract, courts will look at the (1), the (2), and the other party’s (3) of the intoxication. They will also consider whether th intoxicated person ratified the contract by failing to (4) it when sober.

A
  1. cause (bad reaction to rx)
  2. degree
  3. awareness
  4. disaffirm
32
Q

A person, the (1), who fears becoming incompetent will sometimes sign a (2) to appoint another to act as (3). A (4) remains valid despite principal’s loss of mental capacity.

A
  1. principal
  2. power of attorney
  3. agent
  4. durable power of attorney
33
Q

A power of attorney limited to certain areas of a person’s life is called a (1)

A
  1. statutory power of attorney
34
Q

court-appointed person to advocate best interests of a child or incompetent during litigation

A

guardian ad litem

35
Q

attorney whose role is to advocate the child’s position (diff. from guardian ad litem–client’s position may not match best interests)

A

attorney for the child

36
Q

If a person contracts with someone under 18, that person has the ability to (1). This right extends for a (2) beyond 18. Disaffirmation can be done only (3).

A
  1. disaffirm
  2. reasonable time
  3. expressly
37
Q

Unlike disaffirmation of a contract with a minor, which can only be done expressly, (1) of a contract after 18 can be done (2) or (3).

A
  1. ratification
  2. expressly (in words say you want the contract to continue)
  3. impliedly (continue paying; do nothing to disaffirm)
38
Q

Saying someone under 18 has no legal capacity to enter a contract is an (1) standard based on one’s (2). It prevents (3) and protects minors from their own (4). For the sake of disaffirmation, whether the contract is (5) or not does not matter.

A
  1. objective
  2. birth certificate
  3. exploitation
  4. own decisions
  5. predatory
39
Q

If a contract is disaffirmed by the minor, the other party does not have to return (1). Likewise, if the minor (2) from the transaction, that must be paid to the other party. However, if the minor (3) the property, too bad. The general idea of courts about contracting with minors is (4).

A
  1. their benefit (e.g., payments made toward owning car)
  2. profits (sells the car for more)
  3. damages
  4. “do so at your own peril”
40
Q

The exception to contracting with minors, in which the person can legally get the value from the contract, is for (1), which are (2), (3) and (4).

A
  1. necessities
  2. food
  3. clothing
  4. shelter
41
Q

Two things that must be proven with regard to necessities in enforceability of contract

A
  1. Was the item a necessity (determined by courts, matter of law)
  2. Was the item a necessity to the person (matter of fact)(e.g., a minor renting an apartment when her parents provide a home she is welcome in = not a necessity)
42
Q

If a minor lies, almost all jurisdictiosn allow the adult to (1) on the grounds of (2).

A
  1. avoid

2. fraud

43
Q

A minor married to an adult is not under a (1)–in the eyes of the law, she becomes an (2).

A
  1. legal disability

2. adult

44
Q

Minors are always responsible for (1) and for (2). Also, a minor can act as an (3) of an adult.

A
  1. student loans
  2. child support
  3. agent
45
Q

An (1) is one who is not under the control of a parent or guardian. The requirements are that the minor must be (2), a (3), and (4).

A
  1. emancipated minor
  2. 16 or older
  3. resident of the state
  4. financially self-sufficient
46
Q

Incompetence, unlike age incapacity, is based on the parties’ (1) state of mind. The objective comes in with (2). Courts will try to protect the (3), whether the contract is (4) or not.

A
  1. subjective
  2. experts (psychiatrists, etc.)
  3. incapacitated person
  4. improper
47
Q

Mental incompetence relates to (1)–for dimentia sufferers, competence can differ from day-to day.

A
  1. when the contract is entered
48
Q

Two types of competency. The (1) looks for a total lack of understanding–the contract (2) even if it is fair. The (3) looks for a person who has some understanding of the transaction but is unable to act reasonably in relation to that understanding–usually someone is (4) in this situation.

A
  1. cognitive test
  2. voidable
  3. volitional test (person knows he needs a watch but gets talked into a Rolex)
  4. taking advantage
49
Q

A cognitive test is easier when the person is (1) and has a (2) or (3).

A
  1. adjudicated incompetent
  2. guardian
  3. power of attorney
50
Q

(1) are viewed unsympathetically by courts in contract matters, the understanding is “your fault.” But courts are aware of (2). The contract may be voidable if (3) AND (4). In other words, the law does not protect (5), but does protect those who get (6).

A
  1. Intoxicated individuals
  2. alcohol/drug abuse
  3. the person was too intoxicated to understand the nature of the transaction
  4. the other party knows about the intoxication
  5. drunks
  6. taken advantage of
51
Q

Two types of guardianship are (1) and (2). A (3) “goes around” a guardianship, and causes appointment of an (4)–NOT the same thing as an actual attorney.

A
  1. guardian (guards person)
  2. conservatory (guards assets)
  3. power of attorney
  4. attorney in fact (stands in place of person)
52
Q

3 reasons you may choose to go the power-of-attorney route instead of guardianship

A
  1. save money
  2. keep courts out
  3. keep off public record
53
Q

A (1) is appointed to advocate for one particular case–usually this comes in where the actual guardian has a (2).

A
  1. guardian ad litem

2. conflict of interest

LAS204 - Contracts (28 decks)

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