Question 1

Under the Uniform Commercial Code, when the minor has sold goods and the buyer has resold them to a good faith purchaser for value:
A) the minor can disaffirm and recover the property.
B) both the purchaser from the minor and the good faith purchaser for value acquire legal title.
C) the good faith purchaser for value acquires legal title.
D) the good faith purchaser for value receives a voidable title.

Accepted Answer

The Uniform Commercial Code states that when a minor sells goods and the buyer resells them to a good faith purchaser for value, the good faith purchaser for value acquires legal title. This means that the minor is not able to disaffirm and recover the property, and the good faith purchaser for value has valid ownership rights.

Question 2

Discuss the effect of a court's declaring someone incompetent and appointing a guardian.

Accepted Answer

The effect of a court's declaring a person incompetent and appointing a guardian is that the incompetent person will be unable to make valid contracts.Their contracts will be void except possibly for those contracts made for necessaries.

Question 3

Discuss a minor's duty to a seller upon disaffirmance of a contract for the sale of goods.

Accepted Answer

Courts do not agree on how to handle a minor's duty upon disaffirmance.The majority hold that the minor must return any property received from the other party to the contract, provided he is in possession of it at the time of disaffirmance.Nothing more is required, and it can be returned in whatever shape it is in at the time.Other states require at least the payment of a reasonable amount for the use of the property or of the amount by which the property depreciated while in the hands of the minor.A few states recognize a duty on the part of the minor to make restitution so the seller will be in approximately the same position he would have occupied had the sale not occurred.

Question 4

Which of the following is least likely to be classified as a necessary item for which a minor will be held liable on a contract?
A) A camera.
B) School supplies.
C) Clothing.
D) An automobile.

Accepted Answer

The answer of Which of the following is least likely...

Question 5

The doctrine of necessaries applies in the same way to minors and mental incompetents.

Accepted Answer

The doctrine of necessaries holds that a spouse is responsible for providing their partner with necessary items like food, clothing, and shelter. It also applies to minors and mental incompetents, where the parent or guardian is responsible for providing necessaries.

Question 6

While she was 17, Trina purchases a laptop computer.Discuss the implications of her actions as to whether she can disaffirm the contract of purchase if she: (a) tries to sell the computer one year later; (b) continues to use the computer for eighteen months; or (c) has not yet made all of the payments when she turns 18, but continues to make monthly payments.

Accepted Answer

The answer of While she was 17, Trina purchases a...

Question 7

Joe is mentally impaired from the effects of a prescribed medication.If he makes a contract while under this impairment, the contract would be voidable if he cannot comprehend the subject of the contract, its nature, and its probable consequences, even if the other party does not know or have reason to know of his mental condition.

Accepted Answer

This is in line with the principle of capacity to contract, which states that a person must have the mental capacity to understand the terms and consequences of a contract in order for it to be legally binding. If the person is mentally impaired and cannot comprehend these elements, the contract can be voided. The other party's knowledge of the impairment is not a determinant factor in this situation.

Question 8

By the majority view, a minor need only return any property he has received from the other party if the minor wishes to disaffirm the contract.He has no duty to return the property in the same condition in which he received it.

Accepted Answer

The majority view is that a minor only needs to return the property received from the other party if they want to disaffirm the contract. There is no requirement for the minor to return the property in the same condition.

Question 9

If a person with a mental condition that impairs her ability to act in a reasonable manner enters a contract that is grossly unfair, the contract is voidable.

Accepted Answer

A person with a mental condition that impairs their ability to act in a reasonable manner may not fully understand the terms of the contract they are entering into. Therefore, the contract is considered voidable if it is grossly unfair.

Question 10

Ratification makes a contract void from the beginning .

Accepted Answer

Ratification validates a contract from its inception and makes it enforceable from the date it was originally made.

Question 11

Intoxicated persons are liable in quasi-contract for necessaries purchased during their incapacity.

Accepted Answer

This is known as the doctrine of necessaries, which allows a third party to recover the cost of goods or services provided to an intoxicated person if they were necessary for their wellbeing at the time. It is based on the principle that the recipient should not be allowed to unjustly enrich themselves by receiving necessaries without paying for them.

Question 12

In most states, determining what is a reasonable time for disaffirmance depends on circumstances rather than a statutorily prescribed time period.

Accepted Answer

The determination of what constitutes a reasonable time for disaffirmance (the act of denying or nullifying a contract or agreement) often depends on the specific circumstances of each case rather than a fixed time period set by statute. This allows for flexibility based on the nature of the contract, the parties involved, and other relevant factors.

Question 13

Robert Briscoe is 17 years old.He lies to Bouyers Auto about his age in order to induce them to sell him a new pickup truck.Bouyers falls for this lie and sells him the pickup.Under the prevailing view, Robert:
A) may disaffirm and get his money back.
B) may not disaffirm since he lied.
C) may only receive a portion of his money.
D) will receive his money less depreciation.

Accepted Answer

Robert may disaffirm and get his money back because he is a minor and therefore lacks capacity to enter into a contract. The fact that he lied about his age does not prevent him from disaffirming the contract.

Question 14

What is the doctrine of liability for a tort connected with a contract?

Accepted Answer

The answer of What is the doctrine of liability for...

Question 15

In some states, minors are liable for contracts involving bank accounts and student loans and cannot avoid these contracts even though they can avoid other types of contracts.

Accepted Answer

Some states have laws that allow minors to enter into certain types of contracts, such as bank accounts and student loans, with their parents' or guardians' permission. However, minors may still be responsible for fulfilling the terms of these contracts despite their age. Other types of contracts may be avoidable by minors because they lack the legal capacity to enter into them.

Question 16

All states agree that a minor who has fraudulently misrepresented her age when entering into a contract has no power to disaffirm the contract.

Accepted Answer

The ability of a minor to disaffirm a contract due to misrepresentation of age varies by jurisdiction. Some states may allow minors to disaffirm contracts even if they misrepresented their age, while others may limit this ability based on the nature of the misrepresentation or the type of contract.

Question 17

Amelia goes away to college at 17, lives on her own, and pays her own rent and electric bills.If she makes a contract to buy a television set, in most jurisdictions, she may assert her minority status and set aside the contract.

Accepted Answer

As a minor (under 18 in most jurisdictions), Amelia can disaffirm contracts she enters into while still a minor, with certain exceptions (necessaries, statutory exceptions, etc.), even if she lives independently and pays her own bills.

Question 18

In Berg v.Traylor , the court found that:
A) a minor may not disaffirm an agreement signed by a parent.
B) the disaffirmance of an agreement by a minor does not operate to terminate the contractual obligations of the parent who signed the agreement.
C) Craig could not disaffirm the contract to secure personal management services because it was a contract to provide his and his family's necessaries.
D) Craig, an infant, could not disaffirm in this case because it would cause undue hardship on the other party.

Accepted Answer

In Berg v. Traylor, the court held that the disaffirmance of an agreement by a minor does not terminate the contractual obligations of the parent who signed the agreement. Therefore, option B is correct. Option A is incorrect as the court did not address the minor's ability to disaffirm an agreement signed by a parent. Option C is incorrect as the court did not address whether the contract to secure personal management services was for necessaries. Option D is incorrect as the court did not find that disaffirmance would cause undue hardship on the other party.

Question 19

If Carrie, age 14, contracted to buy a fur coat by mail, the coat manufacturer would not have to send it since the contract was void.

Accepted Answer

The statement is incorrect. The contract may be voidable due to Carrie's age, but the manufacturer would still have a legal obligation to fulfill the contract unless it is voided by either party.

Question 20

Melody, age 17, makes a contract with Seung, who is an adult.Melody:
A) may exercise the power of avoidance, called disaffirmance, while still a minor, and thereby be released from any liability on the contract.
B) may ratify the contract while still a minor, thereby surrendering the power of avoidance.
C) has entered a void contract since she lacked capacity.
D) may disaffirm only after reaching the age of majority.

Accepted Answer

As a minor, Melody has the power of avoidance, which allows her to disaffirm the contract at any time before reaching the age of majority, thereby releasing herself from any liability on the contract. Seung, as an adult, is bound by the terms of the contract and cannot avoid his obligations simply because Melody is a minor.

Quiz 14: Contractual Capacity

Under the Uniform Commercial Code, when the minor has sold goods and the buyer has resold them to a good faith purchaser for value: