CHAPTER 16: CONTRACTUAL
CAPACITY AND GENUINE ASSENT
CHAPTER 16: CONTRACTUAL
CAPACITY AND GENUINE ASSENT
Learning Objectives:
• Incapacity to Contract
 Types of Incapacity
 Case of Minors
• Genuine Assent
 Mistake
 Misrepresentation
 Other Grounds
Chapter 16
2
INCAPACITY TO CONTRACT
1. Types of Incapacity
2. Case of Minors
a.
b.
c.
d.
e.
Minors’ Contracts: Voidable
Right to Disaffirm
Ratification
Liability for Necessaries
Third-Party Rights
Chapter 16
3
GENUINE ASSENT
1. Nature of the Concept
2. Categories:
a. Mistake
Chapter 16
4
Mistake
i. Definition: a state of mind that is
inconsistent with reality.
ii. Concept of Materiality
iii. Reformation vs. Avoidance
iv. Nature of Factual Mistake
Chapter 16
5
Mistake (cont.)
…
v. Bilateral Mistake:
I. Def: all parties make the same mistake
II. When relief is appropriate
vi. Unilateral Mistake:
I. Def: only one party makes mistake.
II. When relief is appropriate
vii. Reformation of Written Contracts
Chapter 16
6
GENUINE ASSENT
1. Nature of the Concept
2. Categories:
a. Mistake
b. Misrepresentation
Chapter 16
7
Misrepresentation
i.
Types of Misrepresentation
I.
II.
ii.
Intentional (Fraud)
Unintentional
Fraud
I.
II.
Nature
Elements
Chapter 16
8
Elements of Fraud
1. Scienter (or Intent to Mislead)
2. False Representation
a. Fact
b. Opinion
c. Silence
3. Justifiable Reliance
4. Damage
Chapter 16
9
GENUINE ASSENT
1. Nature of the Concept
2. Categories:
a. Mistake
b. Misrepresentation
c. Undue Influence and Duress
Chapter 16
10
CHAPTER 16: CONTRACTUAL
CAPACITY AND GENUINE ASSENT