Contract Law Contractual Capacity Notes

CONTRACTUAL CAPACITY MINORS presumed not to have capacity when under legal age of adult. Other party bound but minor can void the contract. WHY? Protected by law due to immaturity. EXCEPTIONS: Contracts for necessaries Are enforceable. Necessaries > - 'goods suitable to the condition in the life on such infant or minor…and to his actual requirements at the time of sale & delivery.' - Transport, clothes, food, shelter, water, basic needs. THE TEST is to ask a) is the good a necessary b) is it suitable to the particular individual The problem here is that the vendor won't know what is suitable to the life of the buyer and what isn't. They could have multiple of the goods but this is not in the knowledge of the vendor. EXAMPLE is Nash The buyer was an oxford graduate. Purchasing waistcoats. Contracted to buy them at a later date. Refuses to pay up. Were they a necessary? The courts said that because he already had adequate clothing the waistcoat was not a necessary therefore the contract was not enforceable as he was presumed to have no contractual capacity. Here we can see how this can be unfair on the vendor as he could not have known of the students clothing. However it was also an opportunity for the courts to tell a contractor not to trust a minor with money. After all, loans to minors are not recoverable as they cannot be trusted (next case). Duty of court to strike balance between necessary and luxury. 'luxuries are quite distinct from necessaries'. Earle V Peale 1711 Loans to minors are not recoverable EVEN IF it's a loan to purchase a necessary. Minors cant be trusted Marlow v Pitfield If a loan is given and the minor buys the necessary, then the lender can sue. They are still untrustworthy however the logic behind assumption of no contractual capacity is to protect minors. Once the good has been paid for, they no longer need protection so the lender can sue for breach of contract. Beneficial contracts for services. Keays v Great southern railway Contract entered by twelve-year-old to supply transport services to school. Clause excluded liability for injury. Accident happens and girl sues. RY company seek to rely on clause. Courts find in favour of P because it is 'absurd' that the girl is assumed to be aware of the limitation on her rights. It denies her practically every common right she had in negligence against the company. - Contracts for beneficial services are enforceable unless they are ultimately unbeneficial. Chaplain v Leslie Frewin Charlie Chaplains son is minor at time (19) and estranged from father. Assisted by social services. Enters a contract to write autobiography which is written by a ghost-writer. After done, he decided that he doesn't want involvement anymore. This was a beneficial contract for services and they will only be unenforceable - Where there is no benefit Here the courts said that the profit would help him provide for his family and earn a living - therefore was a beneficial service at time contract was entered.

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