Can a Minor Enter Into a Contract?

Minors and Infants

The terms “minor” and “infant” are used in law to describe a person who is under the legal age of an adult. In nearly all cases, an “adult” is a person who is 18 or older.

Voidable Contract

The general rule regarding contracting with minors or infants is that such a contract is voidable by the minor. This rule has been established to protect younger individuals who may not fully grasp the consequences of certain contracts. Minors are believed to lack the capacity to contract. Therefore, courts and statutes provide minors with the ability to exit the contract at the minor’s discretion. This right does not belong to the other contracting party; it is only at the discretion of the minor. So while the contract is still valid, the minor can basically leave it as he or she sees fit. Due to the fact that such a rule can be abused or otherwise lead to harsh results, a variety of exceptions have been carved out of the general voidability of a minor’s contract.

Necessaries

If every single contract with a minor could be voided, other parties would refuse to enter into a contract with them. The law provides that contracts for certain goods and services are not voidable. Necessaries include items and services that are necessary to the minor’s health and safety, such as food, lodging, shelter and clothing. In some instances, automobiles are considered necessaries. The minor’s and his or her parents economic status can be considered in determining whether an item is considered a necessary. Some courts will enforce the contract as originally written while others may require the minor to pay the fair market value for the goods or services provided. For example, if the minor exited the interstate during a torrential downpour and the hotel was $150 for the night although the fair market value was $100, some courts would impose the $150 price while others would impose the $100 price.

Bank Accounts

Most courts require minors to comply with the terms of their banking agreement. They are subject to the same fees and penalties as other consumers.

Employment Contracts

Many people who are under the age of 18 have some type of employment. Additionally, there are many children in the entertainment industry. Both California and New York have passed legislation that limits such a minor’s right to disaffirm the contract. Some laws allow courts to first approve the contract so that the infant cannot later attempt to void it. Additionally, contracting with the infant’s parent rather than directly with the infant can bind the child in some cases. Some states allow infants to work so long as they acquire a work permit.

Other Contracts

State laws and case law may list other types of contracts that minors cannot void. For example, many states require minors to be held to sports or entertainment contracts. New York allows minors to purchase or be the recipient of a life insurance policy with such policy not being voidable.

Ratification

To avoid a long period of limbo, most states impose rules regarding ratification. The infant can only void the contract while he or she is still a minor. Some states allow for minors to void contracts within a short period of time after the infant’s 18th birthday, such as six months. If the former minor does not do anything to disaffirm the contract by this point, courts may refuse to void the contract. The minor is found to have “ratified” the contract.

Voiding the Contract

A minor can void the contract in one of two ways. The first way is for him or her to file a lawsuit asking the court to void the contract. The second way is to raise the affirmative defense of lack of capacity if he or she has been sued. If a minor voids the contract, he or she must disaffirm the entire contract. The minor cannot pick and choose the provisions of the contract that he or she likes or finds favorable. Additionally, the minor may be required to pay restitution for the benefit of the goods received. Additionally, the minor may be required to return the subject matter of the contract. Courts are split as to whether the minor needs to pay for any repairs or the decrease in value of a good that benefited the minor.

Provided by HG.org

Disclaimer: Every effort has been made to ensure the accuracy of this publication at the time it was written. It is not intended to provide legal advice or suggest a guaranteed outcome as individual situations will differ and the law may have changed since publication. Readers considering legal action should consult with an experienced lawyer to understand current laws and.how they may affect a case.

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