...“Contracts made by minors are void”. Explain this statement and discuss its exceptions. Contracts entered into by a minor, one below the age at which state law deems persons to possess capacity to contract, currently 18 years old in most states are generally voidable by the minor-party, even if he misrepresented his age. A minor can furthermore avoid contractual obligations for a reasonable time after attaining the age of majority. However, if he fails to disaffirm within a reasonable time, the contract will become binding against him. Disaffirmance: Disaffirmance is a contractual obligation, setting aside, or a legal avoidance. For a minor to disaffirm, he or she must declare in words or in oneself, a reason not to be destined in to an agreement of a contract. They must stop the whole agreement, not just a small part of it. Minors must return all of the products that they have, not just the ones they do not want. If there, is a third party (adult) involved and have some of the products, the minor can ask for it back to return it to where he or she bought it. Once a minor reaches, the age of maturity, the court will give them two months or in some states one year to disaffirm. If the minor refuses to disaffirm, the courts will ratified it. Ratification is the act of accepting and giving legal force to an obligation that previously was not enforceable. If an adult is in this court case, they will have to be bound to it and pay. In...
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...TOPIC 4: INTRODUCTION TO CONTRACT LAW — ESSENTIAL ELEMENTS OF A CONTRACT — STEPS 3, 4 AND 5 Please remember to check your Bulletin Board. • Chapters 5 and 6 of Turner. • Chapters 5 and 6 of Gibson (optional). Learning objectives After you have completed the readings for this topic you should be able to: > define consideration and be able to identify when it is present; > explain and apply the legal principles relating to consideration; > explain the difference between past, executed and executory consideration; > explain and apply the doctrine of promissory estoppel; > identify contracts which must be in writing; > recognise the classes of persons who have limited contractual capacity and describe the effect that each has on simple contract; > outline the common law rules regarding contracts entered into by infants and which can be valid, voidable or void; > summarise statutory changes to the common law made in NSW and SA in relation to infants; and > outline the common law rules with regard to capacity to contract with respect to corporations and bankrupts, the mentally ill and those under the influence of alcohol. Graduate School of Business 4:2 Step 3: Consideration Consideration is something for something. Put another way, it is the price the promisee pays for the promise. For example, in the case of the purchase of a house, it is that house in exchange for the purchase price. Consideration makes the agreement in a commercial bargain. A person...
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...A contract can become a very important and essential part of any agreement between people. “A contract is a legally enforceable agreement that is created when two or more competent parties agree to perform or to avoid performing, certain acts that they have a legal right to do and that meet certain legal requirements”. (Anthony L. Liuzzo, 2010) Capacity means that “in the law sense, denotes some ability, power, qualification or competency of persons, natural or artificial, for the performance of civil acts, depending on their state or condition, as defined or fixed by law; as the capacity to devise, to bequeath, to grant or convey lands; or to take and hold lands, to make a contract and the like”. (The 'Lectric Law Library, 2011) The capacity matters when a contract is going to be written. It can become crucial to know the ability of the other party involved in the contract, this way you have a better understanding of how the agreement will function in the future. The wide-ranging belief of the law is that all individuals have a capacity to contract. A person who is trying to escape a contract would have to plead his or her lack of capacity to contract against the party who is trying to enforce the contract. For example, he would have to prove that he was a minor, adjudged incompetent or drunk or drugged, and so forth. Often this is the most difficult burdens of proof to overcome due to the presumption of one's ability to contract. “In most states, the standard for mental...
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...European Business Law 1! ! Introduction to international business law and elements of contract formation! ! ! ! ! Useful for :! • Business relationships depend upon legally binding agreements! • Being aware of contract traps (avoid business troubles)! Law > Contract Law > French contract Law > International Contract Law (comparative law / Unidroit principles / Vienna Convention) > Common Law ! What is a contract law?! 3 main ideas = A contract is act of Freedom / of Willingness / of Foreseeability! 2 main principles = Principle of obligatory force / of good faith! Problems when negotiating a contract :! Is the negotiator empowered?! Severability or not?! Confidentiality or Non-disclosure agreement! ! A Contract is an agreement between 2 or more parties that is binding in law! ! When does a contract come into force? => Agreement on essential terms! ! BEFORE : Elements of contract formation! ! Offer and Acceptance ! ! ! An offer accepted is a contract / A statement of willingness to contract on specified terms! • Express / implied offer! • Adressed to one particular person, a group of persons, or the world at large! • Offer and Invitation difference to treat (= advertising)! Revocation of an offer : ! • Withdrawal of the offer : An offer may be withdrawn at anytime before acceptance! • Lapse of time :! • Where a time-limit : the offer automatically falls on the expiry of that time-limit! • Where no time-limit : An offer only remains open for a reasonable time! • Rejection...
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...civil cases. We skipped Chapter 8 and went onto Chapter 9, which introduced contracts. We discussed the definition of a contract and the sources of contract law. Article 2 of the Uniform Commercial Code for sales of goods, common law for other contracts, and the United Nations’ Convention on the International Sales of Goods are the sources of contract law. The elements of a contract were introduced. These elements were agreement, consideration, capacity, and legality. We classified contracts as bilateral v unilateral, valid, void, voidable, enforceable v. unenforceable, express v. implied, executed v executory, and formal v. informal. These topics were the basis...
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...A coworker of mine who attends Duquesne Law School helped me locate this case. I went to the law school library with him to find and print the case from the database. I used Google Scholar and Lexis Nexis to find the article relating to the legal concept this case addresses. NATURE OF THE CONTROVERSY: Darwin Kruse, an employee of Coos Head Timber Company, was suing his employer because he claimed he lacked sufficient mental capacity to understand the compensation agreement he signed after suffering injuries from an accident at work. PROCEDURAL HISTORY: This case was brought before the court because Darwin Kruse, an employee of Coos Head Timber Company, is seeking to recover damages for injuries he suffered as a result of an accident he had at work. Darwin Kruse, the appellant, was removing rock from the inside of a base of an elevator mechanism. While doing so, the tower vibrated and a piece of wood from the top of the tower fell and struck him on the back of the head. After the accident, Mr. Kruse signed a compensation agreement with his employer, Coos Head Timber Company. In the agreement he received compensation for the accident and released his employer from any further claims for damages. Mr. Kruse claimed the agreement should not be enforced because he entered into it under circumstances of fraud and misrepresentation. Mr. Kruse also argued that the compensation agreement should not be enforced because he lacked sufficient mental capacity because he was mentally...
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...CAPACITY TO MAKE CONTRACTS The capacity of certain persons to conclude contracts is restricted by law. The law recognizes that certain people are either wholly or partly incapable to make a contract. The aim of this assignment is to explain and consider the critical legal matters the individuals and organisations have to consider when entering into a contract with these people. Contracts are part of everyday life and every business will need to make a contract and most businesses will have to make very many. Therefore it is necessary for an organisation as well as for individuals to understand that a contract is a legally binding agreement. In order for a contract to be legally enforceable the law demands agreement, consideration and intention to create legal relations (Maclntyre, 2008). It is generally believed that every person can make a binding contract as they wish (Maclntyre, 2008). But because the contract is a legally binding agreement, the law recognises some specific groups who either have not reached the maturity or do not have the capacity to fully understand the nature and extend of agreements that they make with others. Therefore it is important for every organisation and individual to understand that a number of persons have a restricted capacity to contract. These are minors, persons of unsound mind, drunks and corporations (Owens, 2001). All others can make a binding contract as they please. Beale, Bishop and Furmston (2008) argue that the law of minors`...
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...Elements of a Contract Week 3 Assignment Bus: 670 Legal Environment Micah Blount Prof. Jennifer Stephens February 17, 2014 Introduction The goals of a contract are to ascertain the concord that the parties have prepared and to allot their privileges and responsibilities in accordance with that contract. The legal courts should implement a legitimate contract as it is created, unless there are basis that affect its enforcement. It is the purpose of the decree to promote the development of contracts between capable parties for legal rationales. As a universal statute, contracts by able parties, justifiably prepared, are compelling and enforceable. The provisions to which they have settled force persons to a contract. The purpose of this paper is to determine whether the contract in question is legally bidding. Many people call contracts “agreements”; however, I prefer the term contract, because it can mean one or more agreements within the contract. In contract, word “agreement” sounds as though only one agreement was made. A contract is formed when two or more persons or “parties” (hereafter party) agree to do, or to refrain from doing, something; and each party has some sort of stake in the outcome. In other words, one party cannot provide all the benefits while the other party provides nothing. For a valid contract to be formed that is enforceable by a court, each of the following criteria must be present: offer, acceptance, consideration, capacity, and legality...
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...Introduction to contract …………………………………………………………....1 2. Age of majority …………………………………………………….……..1 3. What contract that a minor can enter?......................................................................2 4. Contract of necessaries ……………………………………………………………3 5. Contract of scholarships………………………………………………………..….4 6. Contract of employment ………………………………………………………..…4 7. Contract of marriage ………………………………………………………..…5 8. Reference ……………………………………………………..……6 Introduction to contract Contract (or informally known as an agreement in some jurisdictions), can define as an agreement having lawful object entered into voluntarily by parties or a legally binding or enforceable agreement. Each of whom intends to create one or more legal obligations between them. The legislation in Malaysia governing contract is the Contract Act 1950(Act 136), which revised in year 1974. Contracts are an integral part of our daily lives. There are constantly being entered into by individuals with other individuals or business, as well as businesses with other businesses, to sell or transfer property, to provide and receive services and other rights and obligations created (Lee Mei Pheng & Ivan Jeron Dette, 2014). Contracts are closed connected with our daily life, for example, the sales and purchase of goods in based on contract, the employer hiring employees is based on contract, the bank provide...
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...enter into a legally binding agreement, consideration and capacity to contract. If any of the five elements are missing from any contract, then it is either void or voidable. Rules of intention to enter into a legally binding agreement, and consideration are two elements which need to be apparent before a contract will be seen as legitimate in front of the law. Consideration is the idea of value in law. It can be a promised action or the omission of an action that the parties to a contract agree upon. Consideration can take the form of money, physical objects, or a forbearance of action. In this example, EC sells the stove and the stereo for Rp 20 million. The consideration from EC is the stove and the stereo and the consideration from Gabriela is the Rp 20 million which is on credit. Consideration alone is not enough to create a legally binding contract; the parties must also have the intention to create legal relations. Rules of intention refer to the final element necessary for a contract. This intention to enter into a legally binding agreement needs to be established because when contracting parties don't consent to the legally binding relationship the contract is not enforceable. Often, the intention to create legal relations is expressly stated by the contracting parties. In other situations, the law will readily imply the intention, because of the nature of the commercial dealings between the parties. Legal capacity of persons refers to their status or capability to enter...
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...Elements of a Contract By Michael A. Petrat Business Law 206 Most people in our society are involved in contractual agreements of some kind. In most, if not all, aspects of law contracts can be found. Contracts are involved in family law, corporate law, employment law, litigation and real estate. Elements of a Contract: A contract is an agreement reached after sufficient consideration to do, or refrain from doing, some legal action. A contract is considered valid when two or more parties with capacity make an agreement involving valid consideration to do or to refrain from doing some lawful act. If these elements exist, the contract is valid. If one or more or these necessary elements is missing, the contract is void or voidable. In other words, it is not a true contract and therefore cannot be enforced. A void contract is no contract at all. It is not binding and no action can be maintained if it is breached. A disaffirmed is not necessary to avoid a void contract. If a contract can be rejected by one of the parties on legal grounds, it is called a voidable contract. A voidable contract is valid and binding unless the entitled party (the party who has legal grounds to reject the contract) voids it. A defect exists. The defect may be cured by ratification of the entitled party. The three basic components of a contract are the offer, the consideration and the acceptance. The following are six elements that are to help to determine whether or not the basic components...
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...Facts The case study describes about the tragic incident of Dorothy J.Drury, who died from injuries sustained in a fall while living at an...
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...to understand what the meaning of the term contract is and what and what the requirements are for the formation and dissolution of one. A contract is an agreement between at least two parties giving rise to legal obligations within the limits of the law. The rights and obligations arising from a contract entitle parties involved to receive and demand performance and actions are enforceable by law. Rights and duties are created by the formation of contracts- a right is an advantage entitling the holder to demand that another person should act or refrain from acting. A duty- is a responsibility imposed by law and obliges a person to act or refrain from performing. There are different types of contracts in our legal system which have certain special elements and legal requirements. One of these elements being the capacity to act by each party; which means that the parties involved in the contract must be legally capable of performing the particular act which gives rise to the formation of the contract. According to South African law every legal subject , irrespective of whether he or she is a natural person or a juristic person legally has the capacity to be the bearer of rights and duties, it’s important to note that not every person who has legal capacity has capacity to act. According to (Havenga ,2007:p71) Capacity to act refers to the capacity to perform juristic acts, to participate in legal dealings and to conclude valid contracts, it then becomes clear that only natural...
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...exchange of business. Don, without mentioning anything to the Scuppernongs grape company owner, had his minor son sign a contract that included a guaranteed price schedule. This is when the relationship was officially damaged. Scuppernongs grape company now has a contract offer to be exclusive with a company in Connecticut. When the Scuppernongs grape company owner contacted Don, he informed him of the contract and that he intended to hold the Scuppernongs grape company to the terms detailed. Due in part to the contract being invalid as it was signed by a minor who also was not an authorized legal representative of the company, the Scuppernongs grape company should accept the contract offer from Connecticut. Minor’s capacity to contract The Scuppernongs grape company owner’s son was working part-time as a delivery driver and was minor at the time Don had him sign a contract as a representative of his father’s company. Don did this without the knowledge of the minor’s father. Minors are not capable of entering into contracts unless there are specific and preapproved prerequisites met, and in the case of the aforementioned minor there are no preapproved reasons as to why he would be able to enter into contract himself. The law considers that such people need to be protected from exploitation, and will generally refuse to enforce contracts against them on the basis...
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...Learning Team Assignment – Understanding Contract Law, Risk and Opportunities Cynthia M. Cervantes Myphuong Le Karl Limpin Laura Semmler Cezner Velez Business Law 531 University of Phoenix Dr. Maurice Rosano, MBAM, JD May 30, 2009 Contract Law in Private Enterprise Discuss the importance of contract law to the private market system. How does Contract law provides flexibility and precision in business dealings? Response: One of the most common legal transactions a business will be involved in is a contract. Contracts are governed by laws in the state where the contract is made. Sound business agreements will result with a basic understanding of contract law. Businesses must be able to rely on commitments in order to grow their business. Contract law also provides legally enforceable agreements in the event that a dispute arises. Contract law provides flexibility by allowing the formalized agreement between two or more parties to relate to any particular subject. Contracts can cover an extremely broad range of matters, including the sale of goods or real property, the terms of employment or of an independent contractor relationship, the settlement of a dispute and ownership of intellectual property developed as part of a work for hire. Contracts provide precision in their ability to be written to an exact specification. Sources of Contract Law (a) What is meant by the common law of contracts? (b) What is the UCC? Response: According...
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