LAW 122 Lecture Notes - Lecture 7: Transact, Undue Influence, Consumer Protection
27 Nov 2017
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We will explore: personal incapacity of minors, mentally incapacitated persons, and intoxicated persons, business corporations and associations. Ie. minors cannot avoid contracts of employment that are to their benefit. Contract is voidable only if the other party should have recognized the problem risk management: employees should be trained to identify potential problems. Judicially declared mentally incompetent total incapacity to contract. Contracts are void and cannot be enforced: mentally incompetent but not judicially declared. Most contracts voidable if other party knew of disability. But capacity to contract for necessities of life: risk management: train employees to recognize potential capacity issues. Intoxication may render contract voidable if too drunk to understand circumstances and: other party aware of extent of intoxication, voidable contract must be avoided promptly once sober or will be considered affirmed. Business corporations: corporations are treated as legal persons, for purposes of capacity, law recognizes two types of corporations chartered corporation statutory corporation: have limited contractual capacity.
