An insane person can escape a contract on the basis of incapacity only if the other person knew or ought to have known of the insanity.

Question

Quizplus · Accepted Answer

In contract law, a person must have the mental capacity to understand the nature and consequences of the contract. If one party is insane and the other party knew or should have known about the insanity, the contract may be voidable due to lack of capacity.

An Insane Person Can Escape a Contract on the Basis