Which groups lack capacity to enter into a contract according to the material?

Which groups lack capacity to enter into a contract according to the material?

• A. Intoxicated
• B. All of the above
• C. Mentally Incompetent (must be NY adjudicated)
• D. Minors

Answer: (B)

Capacity to contract means a party must understand what they are agreeing to and be legally able to bind themselves. Minors generally lack that capacity, so their contracts are voidable at the minor’s option, with typical exceptions for necessaries and other protective rules. Intoxicated individuals may lack capacity if their intoxication prevents them from grasping the nature and consequences of the deal, making the contract voidable by the intoxicated party. Mentally incompetent individuals, when there is a court adjudication of incapacity (as in New York), also lack the ability to contract. Since each of these groups can be devoid of the necessary capacity, the inclusive option is the best answer.

Capacity to contract means a party must understand what they are agreeing to and be legally able to bind themselves. Minors generally lack that capacity, so their contracts are voidable at the minor’s option, with typical exceptions for necessaries and other protective rules. Intoxicated individuals may lack capacity if their intoxication prevents them from grasping the nature and consequences of the deal, making the contract voidable by the intoxicated party. Mentally incompetent individuals, when there is a court adjudication of incapacity (as in New York), also lack the ability to contract. Since each of these groups can be devoid of the necessary capacity, the inclusive option is the best answer.