Chapter 7 Contractual Capacity. Requirements Now that we have a valid offer and acceptance, we have an agreement Capacity relates directly to the involvment.

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Presentation transcript:

Chapter 7 Contractual Capacity

Requirements Now that we have a valid offer and acceptance, we have an agreement Capacity relates directly to the involvment of minors in K “Legal ability to enter a K” Rebuttable presumption is when people assume the other party has capacity to enter into the K

What is a Minority????? A person who has not reached the age of legal adulthood The age of majority is 18 NATIONWIDE You reach a particular age the beginning of the day before your birthday (p.148) You might want to photocopy that page if you plan to use this loophole!!!

What is emancipation? If you are no longer under the control of your parents, you are emancipated. They are fully responsible for their own contracts. If you become emancipated, you might want a copy of the judges orders, because many merchants still hesitate to do business with a young person.

What if you “lie”??? If a minor lies about their age, they commit fraud. This is a crime…..

Contracts of Minors The law shields minors. Minors are protected in case they get into a one-sided deal. Contracts made by minors are voidable by the minor ONLY! Minors can disaffirm contracts (get out of them)—even if they damage or destroy an item

How do I do this???? See letter on page 153 as a guide Return the merchandise Must disaffirm the WHOLE contract Caveat! A minor making a contract with another minor allows either one to disaffirm the contract

Does this mean I can get out of anything?????? You MUST pay for necessaries (medication, food, clothing, shelter) After you reach 18, you can ratify a contract you make while younger. Ratify means approve. You can write that person, continue to pay on the contract, or keeping the item a reasonable time after you turn 18.

Is this just for minors? Mentally Impaired Persons – may have a guardian appointed for them Intoxicated persons – must prove they did not know what they were doing Illegal aliens—may not allow aliens to get into contracts.