Chapter_14_Answers_to_Problems
7 Pages

Chapter_14_Answers_to_Problems

Course: BLAW 3201, Fall 2011

School: LSU

Word Count: 5657

Rating:

Document Preview

C HAPTER14 CONTRACTUAL CAPACITY 1 ANSWERS TO PROBLEMS CHAPTER 14 1. Michael, a minor, operates a one-man automobile repair shop. Anderson, having heard of Michael's good work on other cars, takes her car to Michael's shop for a thorough engine overhaul. Michael, while overhauling Anderson's engine, carelessly fits an unsuitable piston ring on one of the pistons, with the result that Anderson's engine is...

Unformatted Document Excerpt
Coursehero >> Louisiana >> LSU >> BLAW 3201

Course Hero has millions of student submitted documents similar to the one
below including study guides, practice problems, reference materials, practice exams, textbook help and tutor support.

Course Hero has millions of student submitted documents similar to the one below including study guides, practice problems, reference materials, practice exams, textbook help and tutor support.

HAPTER14 CONTRACTUAL C CAPACITY 1 ANSWERS TO PROBLEMS CHAPTER 14 1. Michael, a minor, operates a one-man automobile repair shop. Anderson, having heard of Michael's good work on other cars, takes her car to Michael's shop for a thorough engine overhaul. Michael, while overhauling Anderson's engine, carelessly fits an unsuitable piston ring on one of the pistons, with the result that Anderson's engine is seriously damaged. Michael offers to return the sum that Anderson paid him for his work, but refuses to make good the damage. Can Anderson recover from Michael in tort for the damage to her engine? Why? Answer: Liability for Tort Connected with Contract. No. Decision for Michael. It is clear that the negligence by Michael in carelessly fitting an unsuitable piston ring on one of the pistons, thereby seriously damaging the engine in Andersons car, grew out of a voidable contract; it would not have occurred had there been no contract, and it is inextricably bound to and interwoven into the contract. To allow recovery for the tort would indirectly enforce the contract, which the court would not permit. 2. (a) On March 20, Andy Small became seventeen years old, but he appeared to be at least twenty-one. On April 1, he moved into a rooming house in Chicago where he orally agreed to pay $300 a month for room and board, payable at the end of each month. (b) On April 4, he went to Honest Hal's Carfeteria and signed a contract to buy a used car on credit with a small down payment. He made no representation as to his age, but Honest Hal represented the car to be in A-1 condition, which it turned out not to be. (c) On April 7, Andy sold and conveyed to Adam Smith a parcel of real estate that he owned. On April 30, he refused to pay his landlady for his room and board for the month of April; he returned the car to Honest Hal and demanded a refund of his down payment; and he demanded that Adam Smith reconvey the land although the purchase price, which Andy received in cash, had been spent in riotous living. Decisions as to each claim? Answer: Liability for Necessaries . (a) Even where a minor is liable for necessaries he is not liable at the contract rate but only for the reasonable value. Here, Andy is liable for the reasonable value of the room and board for April. (b) Liability for Misrepresentation of Age . Andy did not misrepresent his age. He may disaffirm the contract and, upon returning the car to Honest Hal, since he still has it, he will be entitled to a refund of his down payment, and will not be liable for the balance of the purchase price. Hal may be charged with fraudulent inducement if he had knowledge of the cars poor condition. (c) Disaffirmance . Where a minor sells real property he may not disaffirm the transaction until his majority. Upon reaching majority and within a reasonable time thereafter he may disaffirm the sale. A minor need only return the consideration received, under the majority rule, if he still has it in his possession at the time of disaffirmance. 3. Jones, a minor, owned a 2006 automobile. She traded it to Stone for a 2007 car. Jones went on a three-week trip and found that the 2007 car was not as good as the 2006 car. She asked Stone to return the 2006 car but was told that it had been sold to Tate. Jones thereupon sued Tate for the return of the 2006 car. Is Jones entitled to regain ownership of the 2006 car? Explain. Answer: Disaffirmance . No. Although Jones could avoid the sale as against Stone, he could not recover the car from Tate who purchased the car in good faith and for value from Stone. At common law Jones, the minor, could recover the car from the third person, Tate, to whom Stone, the other party to the contract with Jones had transferred it, even though the third person did not know of the minority and purchased the car for value. However, the UCC repudiates this rule, Section 2-403(1) provides that "a person with voidable title has power to transfer a good title to a good faith purchaser for value." 4. On May 7, Roy, a minor, a resident of Smithton, purchased an automobile from Royal Motors, Inc., for $12,750 in cash. On the same day, he bought a motor scooter from Marks, also a minor, for $750 and paid him in full. On June 5, two days before attaining his majority, Roy disaffirmed the contracts and offered to return the car and the motor scooter to the respective sellers. Royal Motors and Marks each refused the offers. On June 16, Roy brought separate appropriate actions against Royal Motors and Marks to recover the purchase price of the car and the motor scooter. By agreement on July 30, Royal Motors accepted the automobile. Royal then filed a counterclaim against Roy for the reasonable rental value of the car between June 5 and July 30. The car was not damaged during this period. Royal knew that Roy lived twenty-five miles from his place of employment in Smithton and that he would probably drive the car, as he did, to provide himself transportation. Decision as to (a) Roy's action against Royal Motors, Inc., and its counterclaim against Roy; (b) Roy's action against Marks? 2 CONTRACTUAL CAPACITY CHAPTER14 Answer: Liability for Necessaries . (a) Roy, a minor, had the right to disaffirm the contract for the purchase of the automobile, if it is a non-necessary. On the other hand, if the car is considered a necessary, as in Rose v. Shehan Buick , Roy would either be liable for the reasonable value of the automobile or if allowed to disaffirm for the reasonable value of use and depreciation of the automobile. Here, since Royal accepted the return of the automobile it may have forfeited its right to the former: the reasonable value of the automobile. (b) Disaffirmance . Decision for Roy and against Marks for the return of the purchase price of the motor scooter. The general rule that the contracts of a minor are voidable at his option applies to an executed contract between two minors. To hold the rule inapplicable, the court, in Hurwitz v. Barr, D.C. App., 193 A.2d 360 said: would convert the privilege of infancy, which the law intends as a shield, to protect the minor, into a sword to be used to the possible injury of others. W hile Marks as a minor has the option of disaffirming the contract, this option cannot nullify any rights or privileges which Roy, also, a minor, is capable of asserting. Accordingly, Marks cannot destroy Roys right to rescind, and the contract was therefore voidable by Roy. 5. George Jones on October 1, being then a minor, entered into a contract with Johnson Motor Company, a dealer in automobiles, to buy a car for $10,850. He paid $1,100 down and, under the agreement, was to make monthly payments thereafter of $325 each. After making the first payment on November 1, he failed to make any more payments. Although Jones was seventeen years old at the time he made the contract, he represented to the company that he was twenty-one years old because he was afraid that if the company knew his real age, it would not sell the car to him. 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 he had paid on it. On refusal of the company to do so, George Jones brought an action to recover the $1,425, and the company set up a counterclaim for $1,500 for expenses it incurred in repairing the car. Who will prevail? Why? Answer: Liability for Misrepresentation of Age . George Jones may disaffirm the contract even though he deliberately misrepresented his age. Most courts would hold that Jones is not estopped from asserting his minority in order to sue Johnson Motor Company. At the same time, many courts would not grant Jones the relief sought unless he offered to return the car and also to account to the company for depreciation and the value of the use of the car where he has falsified his age. Here, the car has already been repossessed by Johnson Motor Company. This problem is based upon the leading case of Myers v. Hurley Motor Co., 273 U.S. 18, 47 S.Ct. 277, 71 L.Ed. 515, 50 A.L.R. 1181, where a minor appeared to be more than 21 but made no misrepresentation to induce the making of the contract for the purchase of an automobile. The seller repossessed the car, and the minor, after attaining his majority, sought to recover the amount paid on the purchase price. The seller sought to recover a somewhat larger amount for damages to the car while in the minor's possession. The United States Supreme Court stated that: "The defense, in effect, is that the plaintiff was guilty of tortious conduct to the injury of the defendant in the transaction out of which his own cause of action arose. In such case it is well settled that the relief is by way of recoupment." The seller was held entitled to a setoff up to but not exceeding the amount of the plaintiff's claim. The company would be entitled to a setoff of $1,225, for depreciation in value, against the amount of Jones' claim. 6. Rebecca entered into a written contract to sell certain real estate to Mary, a minor, for $80,000, payable $4,000 on the execution of the contract and $800 on the first day of each month thereafter until paid. Mary paid the $4,000 down payment and eight monthly installments before attaining her majority. Thereafter, Mary made two additional monthly payments and caused the contract to be recorded in the county where the real estate was located. Mary was then advised by her attorney that the contract was voidable. After being so advised, Mary immediately tendered the contract to Rebecca, together with a deed reconveying all of Mary's interest in the property to Rebecca. Also, Mary demanded that Rebecca return the money she had paid under the contract. Rebecca refused the tender and declined to repay any portion of the money paid to her by Mary Can Mary cancel the contract and recover the amount paid to Rebecca? Explain. Answer: Ratification. No. Decision in favor of Rebecca. A minor may disaffirm a contract for the sale of real property made by him during minority within a reasonable time after attaining his majority and he may, by acts recognizing the contract after becoming of age, ratify it. Since Mary had made two payments and caused the contract to be recorded, after she became of age, she arguably ratified the contract and will not be permitted to say that she performed these acts of ratification in ignorance of her right to disaffirm. She was not induced by fraud or C HAPTER14 CONTRACTUAL CAPACITY 3 misrepresentation to enter into the contract. The two payments after attaining her majority evidenced Marys intention to comply with the contract and constituted a ratification of it, unless the fact that she did not then know the law authorized her to disaffirm thereafter. Mary is presumed to know the law, and cannot be heard to say that she was ignorant of her legal right in that respect. 7. Anita sold and delivered an automobile to Marvin, a minor. Marvin, during his minority, returned the automobile to Anita, saying that he disaffirmed the sale. Anita accepted the automobile and said she would return the purchase price to Marvin the next day. Later in the day, Marvin changed his mind, took the automobile without Anita's knowledge, and sold it to Chris. Anita had not returned the purchase price when Marvin took the car. On what theory, if any, can Anita recover from Marvin? Explain. Answer: Liability for Tort Connected with Contract. Marvin, the minor, having made a contract for the purchase of the car from Anita, and having received possession thereof, was the owner of the car, subject to disaffirmance. The act of disaffirmance, however, is not a new contract, which the minor, in turn, may disaffirm. Upon disaffirmance he merely had the right to the return of the purchase price. Therefore, when Marvin changed his mind, he created no new rights in himself. He had retransferred possession and title to the car to Anita. Marvin's taking the car constituted the tort of conversion, and Marvin would be liable in an appropriate action based upon his tortious act. 8. Ira, who in 2005 had been found innocent of a criminal offense because of insanity, was released from a hospital for the criminally insane during the summer of 2006 and since that time has been a reputable and well-respected citizen and businessperson. On February 1, 2007, Ira and Shirley entered into a contract in which Ira would sell his farm to Shirley for $100,000. Ira now seeks to void the contract. Shirley insists that Ira is fully competent and has no right to avoid the contract. Who will prevail? Why? Answer: Mental Illness or Defect . Shirley should prevail. As Ira was not under guardianship, he would have to establish that he was unable to comprehend the subject of the contract, its nature and probable consequences in order to avoid the contract. The facts of this problem do not establish such a situation. 9. . Daniel, while under the influence of alcohol, agreed to sell his 2000 automobile to Belinda for $8,000. The next morning, when Belinda went to Daniels house with the $8,000 in cash, Daniel stated that he did not remember the transaction but that a deal is a deal. One week after completing the sale, Daniel decides that he wishes to avoid the contract. What result? Answer: Intoxicated Persons. Judgment for Belinda. Even if Daniel at the time of entering into the agreement had been unable to comprehend the nature and effect of the transaction because of intoxication, Daniel affirmed the contract the next morning and is thereby precluded from avoiding the contract. 10. Langstraat, age seventeen, owned a motorcycle that he insured against liability with Midwest Mutual Insurance Company. He signed a notice of rejection attached to the policy indicating that he did not desire to purchase uninsured motorists' coverage from the insurance company. Later he was involved in an accident with another motorcycle owned and operated by a party who was uninsured. Langstraat now seeks to recover from the insurance company, asserting that his rejection was not a valid rejection because he is a minor. Can Langstraat recover from Midwest? Explain. Answer: Ratification/Disaffirmance. Judgment for Midwest Mutual Insurance Company. This is not a case in which the minor seeks to disaffirm a contract. What Langstraat seeks here is to ratify and retain the benefits of the policy but to avoid the one provision which has become burdensome. A minor is not permitted this selective choice. Ratification and disaffirmance go to the whole contract. Since Langstraat did not wish to disaffirm the insurance policy, the notice of rejection is valid, and he is not entitled to recover. Langstraat v. Midwest Mutual Ins. Co., 217 N.W.2d 570 (Iowa 1974). 11. G.A.S. married his wife, S.I.S., on January 19, 1997. He began to suffer mental health problems in 2003, during which year he was hospitalized at the Delaware State Hospital for eight weeks. Similar illnesses occurred in 2005 and the early part of 2007, with G.A.S. suffering from such symptoms as paranoia and loss of a sense of reality. In early 2008, G.A.S. was still committed to the Delaware State Hospital, attending a regular job during the day and returning to the hospital at night. During this time, he entered into a separation agreement prepared by his wifes attorney. G.A.S., however, never spoke with the attorney about the contents of the agreement; nor did he read it prior to signing. Moreover, G.A.S. was not independently represented by counsel when he executed this agreement. Can G.A.S. disaffirm the separation agreement? Explain. Answer: Incapacity. Yes he may disaffirm it. Only competent persons can make a contract, and where there is no capacity to understand, there is no contract. Although petitioner was still under 4 CONTRACTUAL CAPACITY CHAPTER14 commitment to Delaware State Hospital at the time of the separation agreement, he had not been judicially adjudicated mentally incompetent, and therefore the agreement is not void but may be voidable. The mental incapacity sufficient to permit the cancellation of an agreement must render the individual incapable of understanding the nature and effect of the transaction, and unable to properly, intelligently and fairly protect and preserve his property rights. The domestic relations court held that even if the mental weakness of the petitioner in this case did not rise to the level of contractual incapacity, such weakness is a circumstance that operates to make the separation agreement voidable when coupled with the evidence of lack of independent counsel, undue influence, drug ingestion and unfairness in the transaction that is present in this case. GAS v. SIS, 407 A.2d 253 (Del. 1978). 12. A fifteen-year-old minor was employed by Midway Toyota, Inc., of Great Falls, Montana. On August 18, 2006, the minor, while in engaged lifting heavy objects, injured his lower back. In October 2006 he underwent surgery to remove a herniated disk. Midway Toyota paid him the appropriate amount of temporary total disability payments ($53.36 per week) from August 18, 2006, through November 15, 2007. In February 2008 a final settlement was reached for 150 weeks of permanent partial disability benefits totaling $6,136.40. Tom Mazurek represented Midway Toyota in the negotiations leading to the agreement and negotiated directly with the minor and his mother, Hermoine Parrent. The final settlement agreement was signed by the minor only. Mrs. Parrent, who was present at the time, did not object to the signing, but neither she nor anyone else of legal guardian status co-signed the agreement. The minor later sought to disaffirm the agreement and reopen his workers compensation case. The workers compensation court denied his petition, holding that Mrs. Parrent participated fully in consideration of the offered final settlement and ... ratified and approved it on behalf of her ward ...to the same legal effect as if she had actually signed [it]. ... The minor appealed. Decision? Answer: Disaffirmance. Judgment for the minor. The Montana statute allows a minor to disaffirm his contract. Because the sixteen-year-old claimant signed the petition for final settlement in his own behalf, he alone was the contracting party. Tom Mazurek chose to contract with the claimant; he must be prepared to accept the consequences of claimant's disaffirmance of the petition. The person who deals with an infant does so at his own peril. Defendant claims that the mother, Hermoine Parrent, was present at all times during the signing of the contract, that the mother approved of the contract; that there was no objection to the contract; that the adjuster negotiated with the mother and the claimant prior to and after the signing of the contract, the mother was aware of the contract rights of claimant and did not object to the same. Nevertheless, since the mother did not sign the agreement and since the minor is not bound by the agreement, the agreement is unenforceable. Parrent v. Midway Toyota, 626 P.2d 848 (Mont. 1981). 13. Rose, a minor, bought a new Buick Riviera from Sheehan Buick. Seven months later, while still a minor, he attempted to disaffirm the purchase. Sheehan Buick refused to accept the return of the car or to refund the purchase price. Rose, at the time of the purchase, gave all the appearance of being of legal age. The car had been used by him to carry on his school, business, and social activities. Can Rose successfully disaffirm the contract? Answer: Liability for Necessaries . Decision for Sheehan Buick. The car is a necessary item for Rose to carry out his schooling, business and other activities. Therefore, he cannot avoid the obligation. Rose v. Sheehan Buick, Inc. , 204 So.2d 903 (1967). 14. L. D. Robertson bought a pickup truck from King and Julian, doing business as the Julian Pontiac Company. Robertson, at the time of purchase, was seventeen years old, living at home with his parents, and driving his father's truck around the county to different construction jobs. According to the sales contract, he traded in a passenger car for the truck and was given $723 credit toward the truck's $1,743 purchase price, agreeing to pay the remainder in monthly installments. After he paid the first month's installment, the truck caught fire and was rendered useless. The insurance agent, upon finding that Robertson was a minor, refused to deal with him. Consequently, Robertson sued to exercise his right as a minor to rescind the contract and to recover the purchase price he had already paid ($723 credit for the car plus the one month's installment). The defendants argue that Robertson, even as a minor, cannot rescind the contract since it was for a necessary item. Are they correct? Answer: Disaffirmance by a Minor/Necessary Items . Judgment for Robertson. A minor may rescind a contract to purchase where the property involved is not a necessary. There was no evidence that Robertson, who lived at home with his parents, needed the truck in connection with any work he was doing. Since the defendant failed to prove that the truck was a necessary item, Robertson, as a minor, may rescind. Upon avoidance of the contract Robertson was then entitled to recover the car traded in on payment for the truck, but the defendants had already disposed of it. Robertson was therefore entitled to receive the actual value of the traded-in car. Nevertheless, the actual value of a trade-in C HAPTER14 CONTRACTUAL CAPACITY 5 may be less than the value stated in the contract. Neither party is bound by the contract value. Thus, Robertson is entitled to recover the reasonable market value of the car at the time of purchase ($250), rather than the value stated in the contract ($723). Robertson v. King, 225 Ark. 276, 280 S.W.2d 402 (1955). 15. Haydocy Pontiac sold Jennifer Lee an automobile for $11,552, of which $10,402 was financed with a note and security agreement. At the time of the sale Lee, age twenty, represented to Haydocy that she was twenty-one years old, the age of majority, and capable of contracting. After receiving the car, Lee allowed John Roberts to take possession of it. Roberts took the car and has not returned. Lee has failed to make any further payments on the car. Haydocy has sued to recover on the note, but Lee disaffirms the contract, claiming that she was too young to enter into a valid contract. Can Haydocy recover the money from Lee? Explain. Answer: Infancy. Judgment for Haydocy for the value of the automobile not to exceed its contract price. Although the law allows infants the privilege of disaffirming contracts which operate to their detriment, an infant is estopped from using this defense when the other party has contracted in good faith and it is the infant who induces the contract through false representation. The infant in such cases may not disaffirm the contract without returning the consideration to the other party. Haydocy Pontiac, Inc. v. Lee , 19 Ohio App.2d 217, 250 N.E. 2d 898 (1969). 16. Carol White ordered a $225 pair of contact lenses through an optometrist. White, an emancipated minor, paid $100 by check and agreed to pay the remaining $125 at a later time. The doctor ordered the lenses, incurring a debt of $110. After the lenses were ordered, White called to cancel her order and stopped payment on the $100 check. The lenses could be used by no one but White. The doctor sued White for the value of the lenses. Will the doctor be able to recover the money from White? Explain. Answer: Infancy. Judgment for doctor in the amount of $150 (amount considered reasonable by the court). The contact lenses are considered necessaries and are of no value to anyone except White. Due to the nature of the goods, the doctor cannot be compensated for his loss except by payment of a reasonable amount. An infant may be held liable for the fair value of necessaries despite a contract to pay more. Cidis v. White, 71 Misc. 2d 481, 336 N.Y.S.2d 362 (1972). 17. Williamson, her mortgage in default, was threatened with foreclosure on her home. She decided to sell the house. The Matthewses learned of this and contacted her about the matter. Williamson claims that she offered to sell her equity for $17,000 and that the Matthewses agreed to pay off the mortgage. The Matthewses contend that the asking price was $1,700. On September 27, the parties signed a contract of sale, which stated the purchase price to be $1,800 (an increase of $100 to account for furniture in the house) plus the unpaid balance of the mortgage. The parties met again on October 10 to sign the deed. Later that day, Williamson, concerned that she had not received her full $17,000 consideration, contacted an attorney. Can Williamson set aside the sale based upon inadequate consideration and mental weakness due to intoxication? Answer: Intoxicated Persons. The drunkenness of a party at the time of making a contract may render the contract voidable, but it does not render it void; and to render the contract voidable, it must be made to appear that the party was intoxicated to such a degree that he was, at the time of the contracting, incapable of exercising judgment, understanding the proposed engagement, and of knowing what he was about when he entered into the contract sought to be avoided. Proof merely that the party was drunk on the day the sale was executed does not per se, show that he was without contractual capacity; there must be some evidence of a resultant condition indicative of that extreme impairment of the faculties which amount to contractual incapacity. However, numerous factors combine to warrant the conclusion that the plaintiff was operating under diminished capacity. Testimony showed that Williamson's capacity to transact business was impaired, that she had a history of drinking, that she had been drinking the day she conducted negotiations, and that she had an apparent weakened will because she was pressured by the possibility of an impending foreclosure. Moreover, Williamson made complaint to an attorney only hours after the transaction. These factors are combined with a gross inadequacy of consideration. Williamson v. Matthews, 379 So.2d 1245 (Ala. 1980). 18. Halbman, a minor, purchased a used Oldsmobile from Lemke for $1,250. Under the terms of the contract, Halbman would pay $1,000 down and the balance in $25 weekly installments. Upon making the down payment, Halbman received possession of the car, but Lemke retained the title until the balance was paid. After Halbman had made his first four payments, a connecting rod in the cars engine broke. Lemke denied responsibility, but offered to help Halbman repair it if Halbman would provide the parts. Halbman, however, placed the car in a garage where the repairs cost $637.40. Halbman never paid the repair bill Hoping to avoid any liability for the vehicle, Lemke transferred title to Halbman even though Halbman never paid the balance owed. Halbman returned the title with a letter disaffirming the contract and demanded return of the money paid. 6 CONTRACTUAL CAPACITY CHAPTER14 Lemke refused. Since the repair bill remained unpaid, the garage removed the car's engine and transmission and towed the body to Halbman's father's house. Vandalism during the period of storage rendered the car unsalvageable. Several times Halbman requested Lemke to remove the car. Lemke refused. Halbman sued Lemke for the return of his consideration, and Lemke countersued for the amount still owed on the contract. Decision? Answer: Disaffirmance. Judgment for Halbman. Halbman, as a minor, had an absolute right to disaffirm the contract for the purchase of the car, since it is not a necessary item. He is also entitled to recover all consideration he has conferred incident to the transaction. As a disaffirming minor, he is under an enforceable duty to return only that much of the consideration as remained in his possession; he need not make restitution for that which he does not possess. If there was a misrepresentation by Halbman or willful destruction of the car, Lemke could have recovered damages in tort. Otherwise, to require a disaffirming minor to make restitution for diminished value is to bind the minor to a part of the obligation that by law he is privileged to avoid. Halbman v. Lemke, 298 N.W.2d 562 (Wisc. 1980). 19. On June 11, Chagnon bought a used Buick from Keser for $9950. Chagnon, who was then a twenty-year-old minor, obtained the contract by falsely advising Keser that he was over twenty-one years old, the age of majority. On September 25, two months and four days after his twenty-first birthday, Chagnon disaffirmed the contract and, ten days later, returned the Buick to Keser. He then brought suit to recover the money he had paid for the automobile. Keser counterclaimed that he suffered damages as the direct result of Chagnons false representation of his age. A trial was had to the court, sitting without a jury, all of which culminated in a judgment in favor of Chagnon against Keser in the sum of $6557.80. This particular sum was arrived at by the trial court in the following manner: the trial court found that Chagnon initially purchased the Buick for the sum of $9950 and that he was entitled to the return of his $9950; and then, by way of setoff, the trial court subtracted from the $9950 the sum of $3392.20, apparently representing the difference between the purchase price paid for the vehicle and the reasonable value of the Buick on October 5, the date when the Buick was returned to Keser. Is this legally correct? Do you agree? Why? Answer: Liability for Misrepresentation of Age. Judgment for Keser. If a minor does not exercise his right to disaffirm a contract within a "reasonable time" after he reaches the age of majority, he loses that right. Here, however, Chagnon's disaffirmance just two months after reaching majority, was within a reasonable time. Once he returned the carthe only consideration in his possession he was entitled to recover the full $9950. While a false representation of his age does not destroy a minor's right to disaffirm, it does permit the seller to deduct from the buyer's compensation any damages that he suffered due to the false representation. The measure of damages for the seller is the difference between the reasonable value of the property on the date of delivery and its reasonable value on the date of return. Since Chagnon obtained the contract by false representation of his age, he will not recover his full $9950. Instead, his recovery is decreased by the amount of Keser's damagesthe loss of the Buick's reasonable value. 20. . On April 29, 2007 Kirsten Fletcher and John E. Marshall III jointly signed a lease to rent an apartment for the term beginning on July 1, 2007, and ending on June 30, 2008, for a monthly rent of $525 per month. At the time the lease was signed, Marshall was not yet eighteen years of age. Marshall turned eighteen on May 30, 2007. Two weeks later, the couple moved into the apartment. About two months later, Marshall moved out to attend college, but Fletcher remained. She paid the rent herself for the remaining ten months of the lease and then sought contribution for Marshalls share of the rent plus court costs in the amount of $2,500. Can Fletcher collect from Marshall? Answer: Minors: Ratification. Yes. A contract of a minor is not void, but is voidable at the election of the minor. After attaining majority, a minor may either disaffirm or ratify a contract that he entered into while he was still a minor. Also, once a contract is ratified by the minor it cannot then be disaffirmed by subsequent conduct. Two weeks after becoming 18 years of age, Marshall moved into the apartment and paid rent. He lived in the apartment for about 1 1/2 months and never took any action to disaffirm the lease before moving out. Marshalls occupancy and payment of rent constitute unequivocal ratification of the lease. Because he had already ratified the lease, his later attempt to disaffirm it by moving out of the apartment and refusing to make further payments was of no effect. Accordingly, the trial courts judgment was against the manifest weight of the evidence. Marshall remained liable for the rent for the remainder of the lease term and is therefore liable to the Fletcher for the rent payments she made on his behalf. 21. Rogers was a nineteen-year-old (the age of majority then being twenty-one) high school graduate pursuing a civil engineering degree when he learned that his wife was expecting a child. As a result, he quit school and sought assistance from Gastonia Personnel Corporation in finding a job. Rogers signed a contract with the employment agency providing that C HAPTER14 CONTRACTUAL CAPACITY 7 he would pay the agency a service charge if it obtained suitable employment for him. The employment agency found him such a job, but Rogers refused to pay the service charge, asserting that he was a minor when he signed the contract. Gastonia sued to recover the agreed-upon service charge from Rogers. Should Rogers be liable under his contract? If so, for how much? Answer: Minors: Necessaries. Yes. Judgment for Gastonia Personnel Corp. In general, a contract with a minor is voidable by the minor unless the contract is for necessaries. The law is based on the idea that society has a moral obligation to protect the interests of minors from overreaching adults. In its effort to protect "older minors" from improvident or unfair contract, however, the law should not deny them the opportunity and the right to obligate themselves for articles of property or services that are reasonably necessary to enable them to provide for the proper support of themselves and their dependents. Since the service provided by the employment agency in finding Rogers a suitable job qualifies as such a service, the contract is not voidable, and the agency can recover the charge.
MOST POPULAR MATERIALS FROM BLAW 3201
MOST POPULAR MATERIALS FROM BLAW
MOST POPULAR MATERIALS FROM LSU