Chapter 4: Capacity Flashcards
What are the two major exceptions to the rule that a minor cannot be a party to and bound by a contract?
- Necessaries which are ‘goods suitable to the condition in life of the minor and to their actual requirements at the time of sale and delivery
- Contract of employment, apprenticeship or education if it is for their benefit
Is a contract against a minor enforceable?
No (some exceptions) but the minor can enforce it against the other party
How does the Mental Capacity Act define lack of capacity?
Being unable to make a decision for himself in relation to the matter including considering the reasonably foreseeable consequences of a particular decision or failure to make a decision at the time the contract is made whether the impairment to understand, retain and use the information to communicate a decision is permanent or temporary
What is the effect of entering into a contract with a person lacking capacity?
The person is still liable to pay a reasonable price for necessaries but for all other cases, the person must show that they did not understand what they were doing and that the other party knew of this to deem the contract voidable
