LAWS104 Study Guide - Final Guide: Life Insurance
22 May 2018
School
Course
Professor
CONTRACTS EXAM NOTES
i. CAPACITY
Minors
- Miners (Property and Contracts) Act (1970) NSW
o S18: not binding if the minor does not have the understanding necessary to
participate
o S19: binding if it is for the minor’s benefit
o S20: the consideration given or received by the minor must not be manifestly
excessive or manifestly inadequate
- Necessaries
o Those things essential to the maintenance of the minor, such as articles
necessary to sustain the minor’s life, including food, clothing, and shelter
o Contracts involving a minor receiving tuition or instruction have been held to
be binding on the minor, as such benefits have been seen to be necessaries
o Scarborough v Sturzaker → Starzaker, a minor, rode his bike a long
distance to work regularly. He traded in his bike and purchased a new one. He
then tried to avoid the contract. The court held that the bike was a class of
goods that could be classified as a necessary
o Bojczuk v Gregorceviz → A minor living in Poland was lent money by a
relative to move from Poland to Australia. The minor subsequently refused to
pay the money back. The court held that migrating to Australia was not a
necessary as the minor had all necessaries in Poland, and therefore they did
not need to pay the money back
- Employment agreements with minors
o If the employment contract does not benefit the minor overall, then it is not
binding and the contract will be void
o De Francesco v Barnum → Case about the ridiculous contract that the minor
had with a dancing school. The court held that it was unenforceable because
overall it was not of benefit of the minor
o Hamilton v Lethbridge → An intern was trained to be a lawyer and agreed to
a contract that prohibited him from opening a practice within 50 miles. He
breached this term and the court held that the contract was valid because it
was ultimately of benefit to the minor
- Life Insurance Act 1995 (Cth)
o S199(2): allows some minors to take out life insurance or take an assignment
of a life policy – a person who is at least 10 years old, but has not reached 16,
may with the written consent of a parent or a person who stands in the place of
a parent enter into a policy, including a life policy on his or her own life or on
another life, or take an assignment of a policy
o S199(2): further provides that a person who has reached 16, but has not
reached 18, has the same capacity to exercise rights or powers in relation to a
policy of which he or she is the owner as a person who has reached 18
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