Ability To Contract

 

By Albert Kelley

 

One of the most important issues to consider before entering into a contract is the ability of the party to enter into a contract. Everyone is presumed to be able to enter a contract unless it is proved otherwise or unless they don’t have capacity due to their status.

 

 

The primary status for incapacity is non-age. In most states, 18-year-olds are legally able to enter into contracts. This is not to say that those under the age of 18 are not able to enter contracts; they can. But they have the special power to void them. In other words, minors can nullify their contracts at any time, until they turn 18 and for a short while thereafter. Once voided, the other party must return all items given him by the minor, even if the minor cannot return the money paid, or the item they received.

 

 

Various statutes remove the non-age disability for various reasons, including: employment; loan contracts for educational purposes; contracts signed by married minors; contracts to perform or render artistic or creative services; to render services as a player or participant in professional or semi-professional athletics; to endorse a product or service; to use the minor’s image for publicity purposes; to sell, lease, purchase or license or otherwise exploit literary, musical or dramatic properties; to receive compensation for services as a coach, trainer, manager or agent.

 

 

The ability to void a contract exists even if the other party is unaware that the minor has not yet reached the age of majority. In addition, parents are not usually liable for the contracts of their children. Therefore, when dealing with minors, it is often a wise move to make their parents part of the contract.

 

 

Another category of incapacity are those who are mentally deficient. Because of their lack of mental acuity, their contracts may also be voided. If the person is so incompetent that he cannot understand the contract is being made, the contract is voidable. However, if he understands the concept of a contract, even if he is mentally disabled, the contract will be valid.

 

 

Intoxicated people are not considered incompetent and their contracts are valid, so long as they were aware they were entering into a contract. Later regrets will not void the contract. However, if they were so drunk that they did not know they were entering into a contract, the contract will be voidable.

 

 

Even if the parties are able to enter a contract, the contract itself still may be void. A contract may also be voided if the parties made a mistake. If the mistake was unilateral (that is, if only one person made a mistake) there is no effect. In other words, if a party misquotes a price and the other relies on that price, the contract is valid at the mistaken price. If, however, both parties are in error, the contract is void. Similarly, if one party deceives the other, the contract may be voidable. Fraud is grounds to void a contract. Finally, where one party can exert their will over the other party, the contracts are voidable.

 

 

Al Kelley is a Florida business law attorney located in Key West and previously taught business law, personnel law and labor law at St. Leo University. He is also the author of “Basics of Business Law” (Absolutely Amazing e-Books). This article is being offered as a public service and is not intended to provide specific legal advice. If you have any questions about legal issues, you should confer with a licensed Florida attorney.

 

 

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