Under the Restatement (Second) of Contracts, intoxication will make a contract voidable if the other party had reason to know that the intoxicated person was so intoxicated that he/she did not understand the transaction.

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This is the correct statement of the rule under the Restatement (Second) of Contracts. Intoxication can make a contract voidable if the other party had reason to know of the intoxicated person's condition and that it prevented them from understanding the transaction. However, if the other party did not have reason to know of the intoxicated person's condition, the contract is generally enforceable.

Under the Restatement (Second) of Contracts, Intoxication Will Make a Contract