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Capacity

15 January, 2016 - 09:32

LEARNING OBJECTIVES

  1. Understand that infants may avoid their contracts, with limitations.
  2. Understand that insane or intoxicated people may avoid their contracts, with limitations.
  3. Understand the extent to which contracts made by mentally ill persons are voidable, void, or effectively enforceable.
  4. Recognize that contracts made by intoxicated persons may be voidable.

A contract is a meeting of minds. If someone lacks mental capacity to understand what he is assenting to—or that he is assenting to anything—it is unreasonable to hold him to the consequences of his act. At common law there are various classes of people who are presumed to lack the requisite capacity. These include infants (minors), the mentally ill, and the intoxicated.