1. What is capacity? How does it relate to contracts? Capacity is a person’s legal ability to enter into a contract. If they do not have the capacity, they cannot legally be a party to a contract.

2. When does a minor become 18 years old for purposes of the law? Technically, a minor becomes 18 the day before their birthday. The law does not count fractions of a day when determining your age

3. Explain the meaning of the saying, “Infancy is a shield, not a sword.” Infancy is the same as being a minor. When a minor intentionally uses their status to take advantage of another, a judge may decide to treat them as an adult. The law protects minors in contractual situations, but it does not condone harmful actions.

4. Why are contracts with mentally impaired persons and persons that have been declared legally insane treated differently? Explain. Mental impairment is most likely a temporary situation, so the impaired person’s contract is voidable. If you are declared legally insane, all of your contracts are automatically void.

5. Do you think an intoxicated person should be allowed to avoid a contract? Explain.

6. You enter into a contract with your neighbor, agreeing to do yard work every Saturday morning. You learn that you have made the school soccer team and that the games are on Saturday mornings. You know that you can legally avoid the contract, but you don’t want to hurt your relationship with the neighbor. How should you approach the neighbor? Give suggestions for alternatives.

7. On the day before his 18 th birthday, David Jones buys a watch at a department store that reads, “ CLOSEOUT SPECIAL! $165. ALL SALES FINAL.” David loses the receipt, but tries to return the watch the next day based on his belief that the watch was purchased when he was a minor. Can he get his money back?

8. Cheryl Garson sues Susan Harris for breach of contract. Harris is able to prove through witnesses that she was intoxicated when the agreement was executed and she did not understand the nature of the agreement. Is the contract enforceable? Explain. No, the contract is not enforceable. Intoxication creates metal impairment, which removes the element of capacity.