Capacity to Contract Flashcards
the ability or power to do, experience, or understand something
capacity
to reject or disown as having no force or authority
repudiate
what types of contracts are legal for minors?
contracts for necessaries of life
define: void ab initio
invalid from the beginning
when is a contract with a minor considered void ab initio?
when it is prejudicial or of no benefit to the minor - they were taken advantage of
contracts for non-necessaries are enforceable by a minor, but if the contract is fully executed, what happens?
the contract cannot be set aside; the
court may order refund if price paid by the minor was
not reasonable
contracts for non-necessaries are enforceable by a minor, but if the contract is not fully executed, what happens?
the minor may avoid the contract but
must return goods or money paid by other party
contracts for non-necessaries are enforceable by a minor, but if the contract is ongoing, what happens?
the minor can repudiate future liability but
cannot recover money spent for benefits already
received
what happens to an ongoing contract for necessaries when a minor reaches the age of majority?
liability continues
when would a contract need to be ratified by a minor?
Contracts for non-necessaries involving a one-time benefit for the minor are invalid unless ratified in writing and signed by the minor during their minority or shortly after
when would a minor need to repudiate an ongoing contract for non-necessaries?
During their minority or shortly after reaching the age of majority
How can a minor repudiate an ongoing contract?
In writing, orally, or inferred from an act by the time they reach the age of majority or shortly after
A contract that does not exist at law because one or more elements of the contract are lacking; an unenforceable contract
Void contract
What needs to be present in a contract with a minor for it to be considered void ab initio?
The contract must be more than “not beneficial” - it needs to be clearly prejudicial or harmful
A contract may be void on the basis of their own intoxication in what circumstances?
- the intoxicated party did not know what they were doing
- sober party was aware, or ought to of been aware that the other was intoxicated
- upon becoming sober, the intoxicated party moved promptly to repudiate the contract
