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Bell Ringer

Bell Ringer. What is a contract? Why are contracts important? Why are contracts different when a minor is involved?. CH 7: Contractual Capacity. Requirement of Capacity. To make a legally binding contract there are six elements:

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Bell Ringer

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  1. Bell Ringer • What is a contract? • Why are contracts important? • Why are contracts different when a minor is involved?

  2. CH 7: Contractual Capacity

  3. Requirement of Capacity • To make a legally binding contract there are six elements: • (1)Offer and (2)Acceptance together form a (3)Genuine Agreement • The last three elements are: (4)capacity, (5)consideration, and (6)legality • Capacity relates directly when considering minors and contracts.

  4. Minor’s Rights and Obligations • Capacity is the legal ability to enter into a contract • When a person enters into a contract, they are permitted to assume that the other party has the capacity to enter into that contract • This presumption comes into play when dealing with minors as minors, within certain limits, have the right to rescind or void their contracts

  5. The age of legal adulthood is known as the ago of majority • A person not at the age of legal adulthood is known as a minor • In 1972 the voting age was lowered from 21 to 18 (because of Vietnam). Most states lowered their age of majority from 21 to 18 • Emancipation: When a minor is no longer under the control of their parents • Even though an emancipated minor is responsible for their own contracts, many merchants refuse to do business with emancipated minors

  6. Misrepresentation of Age • If a minor misrepresents their age, then they have committed fraud • In some states, if a minor lies about their age to enter a contract, and then uses their age to void that contract, the other party can sue the minor • However, if the other party (presumably an adult) can not prove that the minor’s fraud cause financial loss, then the case would not succeed

  7. Some states have laws on the books where a minor can not be sued even if they do commit fraud about their age • Even though you can’t be sued, you can still be arrested for lying about your age in order to buy age restricted items (tobacco & alcohol) • The reasoning behind law is that minors may not be mature enough to responsibly regulate alcohol or tobacco use

  8. Contracts of Minors • The law “protects” minors in making contracts as they could be potentially immature, inexperienced, law education, or naiveté could allow an adult to take advantage of the minor. • Contracts made by a minor is voidable by the minor • The law permits minors second chances because they may use poor judgment • In certain states a monetary amount can be deduced from the refund for damaged items.

  9. If a minor voids a contract they must return any merchandise that may have been received upon entering that contract • When entering into a contract they must accept all aspects of a contract: they can not selectively choose only parts of a contract that benefit them • When two minors enter into a contract with each other either one can void the contract, making contracts between minors especially risky

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