Round 2 Lecture 7 (Contract Capacities) Flashcards
1
Q
contractual capacity doctrine
A
- a contract is not formed unless the parties knowingly assent to its terms.
- need to protect those who are under recognized legal disability
- helps ensure voluntariness of contract
2
Q
when is assent lacking?
A
if the party is under a legal disability law which the law presumes impairs such knowing assent
3
Q
typical situations involving no capacity
A
contract is void:
- a person adjudicated incompetent
- children who have not reached the age of reason (7-10 years)
4
Q
typical situations involving persons with revocable contractual capacity
A
contract is not void, but voidable at option of person under the disability:
- minors
- incompetent persons
- extremely intoxicated persons
5
Q
minors have the right to dissafirm (avoid) contracts previously entered into
A
- when: any time during minority or w/in reasonable time after reaching the age of majority
- how: express or implied
- minor must dissafirm in total and return consideration received in whatever condition it is in
- types of contracts: minor is buyer, seller, recipient of services or provider of services
6
Q
extent of recovery for the minor for executory contracts
A
full recovery
7
Q
extent of recovery for the minor for executed contracts
A
majority rule: complete recovery
minority rule: charge the minor for any reduction in value or for the benefit of use (rent)