Question 1

An action by a minor to avoid the obligations under a contract that has been performed is

Accepted Answer

A disaffirmance is the legal term for an action taken by a minor to avoid the obligations under a contract that has been performed. This is based on the principle that minors lack the legal capacity to enter into binding contracts, and thus can choose to void or disaffirm a contract to avoid its obligations.

Question 2

Mandy, a minor, disaffirms an agreement to purchase a car from Jamie, an adult, for $1000.00. Must Mandy give back the car?

Accepted Answer

In order to disaffirm a contract, a minor must return the consideration received, if possible, to restore the parties to their original positions.

Question 3

Dottie, 15 years old, purchases a pint of milk and drinks it all. While she is not old enough to have contractual capacity, under what theory would she be held liable for this item that is necessary for her health and welfare?

Accepted Answer

Necessaries doctrine holds that minors are liable for the cost of essential items like food, clothing, and shelter, which includes the pint of milk Dottie purchased.

Question 4

Hailey purchased an automobile insurance policy through State Insurance. However, State Insurance failed to use the proper legally mandated insurance form. Hailey gets into an accident and seeks to use her policy. Which statement below is most likely correct concerning the outcome of the issue?

Accepted Answer

The use of an incorrect form by the insurance company does not invalidate the insurance policy itself. The policy can still be enforced by the insured party, as the error is on the part of the insurance company, not the insured. The principle here is that the insured should not be penalized for the insurer's mistake, especially when it comes to mandatory insurance requirements.

Question 5

In Sparrow v. Demonico, the court ruled that in order for a person to lack mental capacity due to a mental illness

Accepted Answer

The correct answer is D because the court's focus in determining mental capacity, especially in the context of a disputed transaction, is on whether the party had the necessary understanding and ability to comprehend the nature and consequences of the transaction at that specific time. The other options are not universally required to establish a lack of mental capacity.

Question 6

Explain the difference between bright-line tests and flexible standards used when determining capacity. When do courts choose to employ one method over another?

Accepted Answer

The answer of Explain the difference between bright-line tests and...

Question 7

Contracts may be determined illegal not only because it violates a statute but also because it violates public policy. Why is this so? Explain the rationale behind the public policy illegality and give an example.

Accepted Answer

The answer of Contracts may be determined illegal not only...

Question 8

Explain the process of disaffirmance of a contract if one of the parties to the contract is a minor.

Accepted Answer

The answer of Explain the process of disaffirmance of a...

Question 9

Luke, an adult, enters into an agreement with Ashlynn, 17 & ½ years old, wherein she agrees to mow his lawn every week for the next year at $50.00 a week. As a term of the contract, Luke also requires Ashlynn to use a lawnmower that violates a state statute as it pollutes the air that substantially exceeds allowed emission limits. Ashlynn mows the lawn every week until after her 18^th birthday until one day local police issue a citation to her for the use of the lawnmower. Given this fact pattern, discuss whether a contract existed based on capacity and legality.

Accepted Answer

The answer of Luke, an adult, enters into an agreement...

Quiz 8: Capacity and Legality