Lack of Capacity

Question 1

1. Is there an agreement
2. Is the agreement is legal
   - serious?
   -less serious? proceed to 3
3. Even if no law is violated, is the agreement against public policy
4. Is the agreement enforceable?

Answer 1

Framework of against public policy

RST 178

Question 2

Announcements

Answer 2

There are going to be things in this class that aren’t just in the slides. Think about the processes and write them in your own words. Informal lunches (6 people first come first serve)

Question 3

Capacity

Answer 3

a defense for why a contract should not be enforced based off the mental abilities

Question 4

RST 12 Lack of capacity

Answer 4

A natural person who manifests assent to a transaction has full legal capacity to incur contractual duties thereby unless he is
- under guard ship
- an infant
- mentally ill
- intoxicated

Question 5

Fairness in capacity

Answer 5

1. Procedural: Unfairness is the bargaining process
   - statut: imbalance of pwoer
   - Behavior: explouting superior bargaining power
2. Substantive: Unfairness in the resulting terms
   - Courts are more likely to police the bargain if there’s been procedural unfairness.

Question 6

Agency in capcity

Answer 6

right to make decisions
Ability to act ourselves / for our selves
Capcity - agency, freedom, full citizenship, human dignity

Question 7

Infancy (young v. Weaver)

Answer 7

Facts: rent is 550 a month and a minor did not pay it after moving out to move back in with her parents. Weaver (leaser) sued.
-
Issue: Is the lease enforceable because living is a necessity?
-
Exceptions to the infancy rule:
- necessity
- misrepresents their age
- Willful damage to property
- Statutory exceptions

Offeror: You can use it on the offensive as well. You can also still disaffirm.

Question 8

necessities rule

Answer 8

1) in general class?
2) Necessary Under the circumstances?
- Can’t be provided by a parent
3) Is there a loss of value of the goods?

Question 9

Mental Incapacity

Answer 9

As justice requires, restitution, to give back the benefit of what is received by the mentally divergent.

Question 10

Cognitive tests unable to understand in a reasonable manner the nature and consequences of the transaction
Volitional Test: unable to act in a reasonable manner in relation to the transaction and the other party has reason to know of his condition

Answer 10

Tests for the mental incapacity defense in contracts

The time of the transaction is the evidence, that he was not competent at the time of the transaction.

Question 11

Mental incapacity (Ford v. Clardy)

Answer 11

Facts: Bobby is bipolar and tried to get a truck he viewed two days prior. The family member then tried to intervene but the business said it was not the family’s business.

Issue: What day constitutes the contract?

Rule:

Defendant argument:

Plaintiff argument:

Question 12

Hampton v. Dillard Dept Stores
Race

Answer 12

Background facts:

Cause of action:

Underlying law:

Holding:

Context:

Question 13

infancy:
Mental capacity
Intoxication: only voidable if the other party knows you are intoxicated and

are unable to understand the consequences of the transaction
He is unable to act in a reasonable manner