Which groups lack capacity to contract?

Which groups lack capacity to contract?

• A. Intoxicated
• B. Minors
• C. All of the above
• D. Mentally Incompetent

Answer: (C)

Capacity to contract means you must understand the nature and consequences of the agreement and be able to consent knowingly. Minors generally lack full capacity, so their contracts are typically voidable at the minor’s option, with limited exceptions for necessities. An intoxicated person may also lack capacity to the extent that intoxication prevents understanding the terms and consequences; such contracts are usually voidable if the person cannot comprehend the agreement while intoxicated. Mentally incompetent individuals—those adjudicated as mentally incompetent or who cannot understand the contract due to mental impairment—also lack the ability to form binding contracts, making their agreements void or voidable. Since each of these groups can be unable to give valid consent, the option that includes all of them best captures who lacks capacity to contract.

Capacity to contract means you must understand the nature and consequences of the agreement and be able to consent knowingly. Minors generally lack full capacity, so their contracts are typically voidable at the minor’s option, with limited exceptions for necessities. An intoxicated person may also lack capacity to the extent that intoxication prevents understanding the terms and consequences; such contracts are usually voidable if the person cannot comprehend the agreement while intoxicated. Mentally incompetent individuals—those adjudicated as mentally incompetent or who cannot understand the contract due to mental impairment—also lack the ability to form binding contracts, making their agreements void or voidable. Since each of these groups can be unable to give valid consent, the option that includes all of them best captures who lacks capacity to contract.