Capacity and Legality：能力与合法性.pptVIP

Chapter 13:Contracts — Capacity and Legality §1: Contractual Capacity Contractual Capacity. The legal ability to enter into a contractual relationship. Full competence. No competence. Limited competence. Legality. The agreement must not call for the performance of any act that is criminal, tortious, or otherwise opposed to public policy. Minors In most states, a person is no longer a minor for contractual purposes at the age 18. A minor can enter into any contract that an adult can. A contract entered into by a minor is voidable at the option of that minor. Minor’s Right to Disaffirm A contract can be disaffirmed at any time during minority or for a reasonable period after the minor comes of age. Minor must disaffirm the entire contract. Disaffirmance can be expressed or implied. Minor’s Obligation on Disaffirmance In most states, minor need only return the the goods (or other consideration) subject to the contract, provide the goods are in the minor’s possession or control. In increasing number of states, the minor must restore the adult to the position held before the contract was made. Case 13.1: Dodson v. Shrader (1992). Misrepresentation of Age Right to Disaffirm. Minor can disaffirm the contract even though minors age is misrepresented. Obligation to Restore. Some courts refuse to allow minors to disaffirm executed contracts unless they can return the consideration received. Some courts allow the defrauded party to sue the minor for misrepresentation or fraud. Contracts for Necessaries Minor may disaffirm the contract but remains liable for the reasonable value of the goods. Criteria: Item contracted for must be necessary for the minor’s subsistence. Value of the necessary must be up to the level required to maintain a minor standard of living. Minor must not be under the care of parent or guardian. Insurance and Loans Insurance. Not viewed as necessaries, so minor can disaffirm contract and recover all premiums paid. Loans. Seldom considered to be necess