Business Law and the Regulation of Business 11th Edition by Richard Mann, Barry Roberts

Exercise 3

On October 1, George Jones entered into a contract with Johnson Motor Company, a dealer in automobiles, to buy a car for $10,600. He paid $1,100 down and agreed to make monthly payments thereafter of $325 each. Although he made the first payment on November 1, he failed to make any more payments. Jones was seventeen years old at the time he made the contract, but he represented to the company that he was twenty-one years old because he was afraid the company would not sell the car to him if it knew his real age. His appearance was that of a man of twenty-one years of age. On December 15, the company repossessed the car under the terms provided in the contract. At that time, the car had been damaged and was in need of repairs. On December 20, George Jones became of age and at once disaffirmed the contract and demanded the return of the $1,425 paid on the contract. When the company refused to do so, Jones brought an action to recover the $1,425, and the company set up a counterclaim of $1,500 for expenses it incurred in repairing the car. Who will prevail? Why?