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Ch10 Law of Capacity
Chapter 10 Law of Capacity
Term | Definition |
---|---|
Age of majority | ability to understand that a contract is being made and its general meaning |
Capacity | ability to understand |
Contractual capacity | ability to understand that a contract is being made and its general meaning |
Disaffirmance | both parties to a contract return the consideration |
Emancipation | severing the child-parent relationship |
Formal emancipation | occurs when a court decrees the minor emancipated |
Incapacitated | parties who have special contractual rights due to a legally recognized lack of such capacity including minors, the intoxicated, and the mentally incapacitated |
Informal emancipation | arises when the parent and minor agree that the parent cease support or when the minor marries, moves out of the family home, becomes a member of the armed forces, gives birth, or undertakes a full-time job |
Intoxication | mental impairment caused by voluntary use of alcohol, drugs, or inhalants |
Mental incapacity | condition in which a party to a contract is unable to understand the consequences of the contractual act |
Minor | individual under the age of majority (18 in most states) |
Minority | minor part of a person's life (typically under the age of 18) |
Necessaries | things needed to maintain life and lifestyle |
Ratification | acting toward the contract as though one intends to be bound by it; principal's assent to unauthorized acts of an agent |
Scope of authority | range of contractual acts an organization has authorized an employee to do |
Non-necessaries | things that are relative luxuries |