Upload
himonesty
View
221
Download
0
Embed Size (px)
Citation preview
7/28/2019 Lecture 6B- Capacity
1/19
Lecture 6B
Capacity To
1
7/28/2019 Lecture 6B- Capacity
2/19
Minors
Minors
A contract between a minor and anotherparty may be one of three types:
1. Va i contract is binding in the usual way
2. Voidable contract is binding unless and until the minor rescinds the contract
3. Unenforceable contract is unenforceable against the minor unless he ratifies (adopts)
it but the other party is bound
2
7/28/2019 Lecture 6B- Capacity
3/19
Minors
Minors
Two types of contract will bind a minor(person under the age of 18, determined by
nors ontracts ct 19 7 :
1. Valid ContractsValid Contracts
Contracts for the supply ofnecessarygoods and services
Service contract for minors benefit
3
7/28/2019 Lecture 6B- Capacity
4/19
Minors(1. Valid Contracts)
Minors(1. Valid Contracts)
NecessariesNecessaries
First Test SuitabilitFirst Test Suitabilit
According to s3 Sale of Goods Act 1979,supply of goods or services must be
suitablesuitable to the condition in life of theminor and to his needs at the time of saleand delivery.
4
7/28/2019 Lecture 6B- Capacity
5/19
Minors(1. Valid Contracts)
Minors(1. Valid Contracts)
NecessariesNecessaries Second Test (Personal needs)Second Test (Personal needs)
personal needs. Goods required for use in a tradeare not necessaries, nor are goods of any kind ifthe minor is already well supplied with them.
Case example:
Nash v Inman 1908
5
7/28/2019 Lecture 6B- Capacity
6/19
Minors(1. Valid Contracts)
Minors(1. Valid Contracts)
Service ContractService Contract
For the minors benefit which contains
an element ofeducation or training.education or training.
Case example:Doyle v White City Stadium 1935
6
7/28/2019 Lecture 6B- Capacity
7/19
Minors(1. Valid Contracts)
Minors(1. Valid Contracts)
If the minor sets himself up in business, hewill not be bound by his trading contracts,
v y .minor can, nonetheless, sue on thesecontracts.
Case example:Cowern v Nield 1912
7
7/28/2019 Lecture 6B- Capacity
8/19
Minors(1. Valid Contracts)
Minors(1. Valid Contracts)
CowernCowern vv NieldNield (1912)(1912)
.
refused to deliver a quantity which had been paidfor by Cowern. It was held that, provided theinfant had not acted fraudulently, he was not
liable to repay Cowern.
8
7/28/2019 Lecture 6B- Capacity
9/19
Minors(2. Voidable Contracts)
Minors(2. Voidable Contracts)
Three kinds of contract which arevoidable:
2.Voidable ContractsVoidable Contracts
Leases of Land
Partnerships
Purchase of Shares
9
7/28/2019 Lecture 6B- Capacity
10/19
Minors(2. Voidable Contracts)
Minors(2. Voidable Contracts)
The contract is binding on the minor until hedecides to reject it. He must reject the contractbefore becomin 18. the main effect of
repudiationrepudiation is to relieve the minor of all futureliabilities. The key to liability or recovery of sumspaid may well depend upon whether the minor
received consideration.
Case example:
Steinberg v Scala (Leeds) 192310
7/28/2019 Lecture 6B- Capacity
11/19
Minors(3. Unenforceable Contracts)
Minors(3. Unenforceable Contracts)
All other contracts entered into
unenforceable the minor isthe minor is
not boundnot bound(though he mayratify it) but the other party is
bound. 11
7/28/2019 Lecture 6B- Capacity
12/19
Minors(3. Unenforceable Contracts)
Minors(3. Unenforceable Contracts)
Any guarantee of the contract
(adult) is validvalidwhether it is
voidable, repudiated by theminor or unenforceable and is
not ratified by the minor. 12
7/28/2019 Lecture 6B- Capacity
13/19
Minors(3. Unenforceable Contracts)
Minors(3. Unenforceable Contracts)
A minor is generally liable for his torts (i.ewrongful acts causing loss or damage to others).
However, he will not be liable if he commits a tortwhich the contract is not binding on him. If hewere liable, the other party would effectively beable to enforce such a contract.
Case example:R Leslie Ltd v Sheill 1914
13
7/28/2019 Lecture 6B- Capacity
14/19
Minors(Other Contracts)
Minors(Other Contracts)
Any guarantee supporting a loan to a minor isisenforceableenforceable against adult guarantor.
But contract made by the minor can beunenforceable against him for some other reason,
for example misrepresentation or duress (beingforced and threatened) by the adult party. In sucha case the guarantor would not be bound
14
7/28/2019 Lecture 6B- Capacity
15/19
Minors(Other Contracts)
Minors(Other Contracts)
A minor may be liable to
certain benefits which he
has received under acontract.15
7/28/2019 Lecture 6B- Capacity
16/19
Minors(Other Contracts)
Minors(Other Contracts)
a. The minor can be made toreturn goods and money which
he still has in his possession. Soif Sebastian, age 17, acquires acase of champagne on credit andfails to pay he can be required toreturn the goods to the seller.
16
7/28/2019 Lecture 6B- Capacity
17/19
Minors(Other Contracts)
Minors(Other Contracts)
b. If the minor has exchanged theoriginal goods for other property the
goods received in exchange. So ifSebastian, in the example above, has
bartered a bottle of champagne for adozen quails eggs, the seller of thechampagne may be able to recover the
quails eggs. 17
7/28/2019 Lecture 6B- Capacity
18/19
Minors(Other Contracts)
Minors(Other Contracts)
c. If the minor has sold theoriginal goods for cash he can
be ordered to hand over the saleproceeds. So if Sebastian sold
the case of champagne for cashhe could be required to handover the money to the retailer.
18
7/28/2019 Lecture 6B- Capacity
19/19
Minors(Other Contracts)
Minors(Other Contracts)
d. If the minor has consumed or disposedof the goods, or the proceeds of any
,compensate the other party. So ifSebastian drank the champagne or
used the proceeds of any sale of thechampagne to pay for an evening at anightclub, he could not be required to
compensate the unpaid seller. 19