in this lecture we shall have a quick overview of the law on capacity to contract as you are aware we have already discussed the elements of a valid and a binding contract and capacity was identified to be one of the elements of a valid and a binding contract in Ghana what this means is that before a person can enter into a valid contract you are required to be close with the required capacity that the law requires so in Ghana what is the age of contractual capacity in Ghana the age of contractual capacity in Ghana is governed by the rules of the common law and therefore is 21 years 21 years now I'm aware some of you be reading books where to show that the age of contractual capacity is 21 years reference will be made to the interpretation Act of 1960 ca4 I have to inform you that that law has been repealed some of you to have been making reference to the company's code of 1963 act 179 that one to has been repealed so bear in mind that the definition of an infant is still governed by the common law and then the minimum age is 20 1 years the interpretation act 1960 has been repealed the company's code of 1963 as 1792 has been repealed the definition for an infant is govern by the rules of the common law and it is still 21 years now when an infant enters into an agreement with an adult for example a person who is 20 years 18 years 19 years enters into an agreement with an adult somebody who is about 30 years 40 years what do the law about those kinds of agreements can the adult enforce the agreement against the infant the common law is that when an infant enters into an agreement with an adult the agreement cannot be enforced against the infant but it can be enforced against the adult party so take note of this that when an infant enters into an agreement with an adult the common law is that the infant can enforce the agreement against the adult but the adult cannot enforce the agreement against the infants so take note of that one as the rules governing the capacity to contract under the common law but there are exceptions to this because if you take note of what I have said we are saying that if an infant enters into an agreement with an adult the infant can enforce against the adults but the adults cannot enforce against the infants there are exceptions to this particular rule there are exceptions that would regulate instances whereby an adult would be able to enforce an agreement against an infant what are those exceptions one is contract for necessaries if it's an agreement for necessaries the outo will be able to enforce the agreement against the infant and the Ador to be able to recover a reasonable amount for the necessaries that have been supplied what are necessaries necessaries are good suitable to the condition of life of the infant and to his actual requirements at the time of delivery necessaries are good suitable to the condition of life of the infant and to his actual requirements at the time of delivery and over here I refer you to look at section two subsection three of the sale of goods act Ghana 1963 act 137 also take a look at the case of Nash and Inman remember Nash and Inman the infant who ordered 11 Fancy with Co and also look at the K of shapo versus Cooper all of these will let you know that if there an agreement for necessaries then the infant will be required to pay a reasonable price for the goods that have been supplied then we have beneficial contract of service these are contracts also that the ERS can enforce against the infant and therefore for beneficial contract of service the law is that when an infant enters into a contract of apprenticeship or a contract of service under which the infant receives instruction or trading or training that contract will be pending on the Infant provided the terms of the contract construed as a whole they are substantially to the benefit of the infant again when an infant enters into a contract of apprenticeship or a contract of service under which the infant receives instruction or trading that contract will be planing on the Infant provided the terms of the contract consed as a whole they are substantially to the benefit of the infant and the authorities over there remember the of De Francisco versus B remember the case of Clement and London Northwestern rway remember these two cases because if an infant enters into an agreement where he's learning he's under apprenticeship to learn hairdressing to learn mry to learn carpentry you are under an apprenticeship to learn a particular tra you are being trained for a particular purpose the Lord say that those agreements that you enter into ConEd as a whole if they they are to your benefit they will be enforcable against you if you forget every case at all don't forget the case of De Francisco versus B now be in mind this beneficial contract of service they have been extended to also apply to contracts that allow the minor to earn a living through the exercise of a profession or occupation they have been extended to include contracts in which the minor is learning is is earning a living through the exercise of a professional trade so you see some questions where you be told that the minor has going to take up a form of teaching to be teaching somebody Son by way of private classes or the minor has going to actually learn how to make money through maybe boxing or something now in this particular things The Beneficial contract of service has been extended to actually include agreements that allow the minor to earn a living through the exercise of a profession or occupation and over there I I invite you to look at the case of doll doll is d y l e versus White City Stadium limited doll d y l e versus White City Stadium limited so the principle is the death beneficial contract of service which I have told you that it applies to contract where you are receiving apprenticeship you under apprenticeship those on have been extended to also apply to contract in which the minor is earning a living through the exercise of a profession or occupation and the authority is door d o y l e Mrs White City Stadium limited but you have to note that trading contracts are not binding on the minor no matter how beneficial they are if it is a trading contract it is not binding on the minor no matter how beneficial the contract is therefore if a minor decides to ear a living by trading there's an absolute B to liability against that minor this means that if an infant supplies you with Goods or agreed to supply you with goods and he FS to deliver the goods if you bring an action against the infant you will not succeed because an infant is absolutely bad from liability from Trading contract The Authority for this is Cen C W RN versus Neil n i e l d so if it's a trading contract there's an absolute B to liability with the minor the third exception of contracts that are enforceable against the minor are avoidable contracts these are contracts in which a minor acquires an interest in some matter of a permanent nature which gives rise to continuous or recurrent obligations these are contracts in which a minor acquires an interest in some matter and it's of a permanent nature and it gives right to continuous or recurrent obligations now these contracts they are binding on the Infant unless and until he repudiates the contract during his minority or within a reasonable time after attaining the age of majority so if anybody ask you what avoidable contract within the context of capacity to contract these are contracts in which a minor acquires an interest in some matter of a permanent nature which gives right to continuous or recurrent obligations these contracts they are bending on the Infant unless and until the infant repudiates this contracts within a reasonable time after attaining the age of majority The Authority for this principle is the key to Cara c a r t e r ver silver s i l b e are what are some examples of contracts that you can describe as voidable contracts if you enter into set agreements with a minor we have contracts for the purchase of shares in companies marage settlement leases or purchases of land now again about the leases some of you be using books where you be saying that we have made reference to section 12 of the conveyancing ACT please that section 12 has been repealed so the con act convening act has been repealed what we have now is The Land Act and you see a similar provision in section 38 subsection 2 of The Land Act the next principle you have to note is that when an infant repudiates avoidable contract he is liable for all the obligations that have been incured by that particular infant prior to the repudiation unless he can prove a failure of consideration the principle is that when an infant repudiates a voidable contract he is La for all the obligations in kep prior to the reputation unless he can prove a failure of consideration The Authority is stain stain is s e i n b e r g stain s i n b e r g SCA s c a l e what about loan contracts if a person ends man lends money to an infant and the infant refuses to pay would the person be able to make an action to recover the money from the infant the common law is that a person who lears money to an infant cannot recover it at long however the person can recover it in equity that part of the money that was actually used to purchase necessaries so it means that if you an adult and you give money to an infant and the infant defaults in pay at common law you can't bring an action against the infant to recover the money but you will be able to bring an action to recover that portion of the money that the infant used to acquire necessories people have been wondering that since people enter the university and their infant 15 16 17 18 since they 21 years when they acquire loans on the student loan scheme can it be that then it means that the state canot bring an action to recover those loans because we have learned that under common law if you give a loan to an infant you can't recover it bear in mind because of this problem in the common law we passed a law called the student loan scheme of 1992 PN law 276 in this law it has been mentioned that students who take loans under the student loan scheme they are conclusively deemed to be treat and treated as of full age at the time of entering into the contract so if you're a person and then you are entering into a contract with and you are a minor and you are taking a loan under the student loan scheme the law conclusively presumes you to be of full age at the time of entering into the contract therefore for you who be able to bring an action against you to recover the loan what if the minor fently misrepresents his age and then and uses you the out party to give the minor a loan or to enter into a contract now the principle is that where the minor ply misrepresents his age and thereby induces you the adult the out party to enter into a contract that contract will still not be enforceable against the minor despite his fraud it means that if the minor shows you an ID card making it look like he's 28 years and never induces you to part with money and enter into a contract with the minor the law is that the agreement will still be unenforceable against the minor it means your loan you still not be able to recover it to wear a minor F LLY misrepresent his age and thereby induces the adult party to enter into a contract which is ordinarily unenforceable against the Minon that agreement will still remain unenforceable despite the fraud of the minor if you want to now C your cause of action in The Law of thought to bring an action against the minor or thought of Deceit that one to the minor will also not be liable for the thought of Deceit because the cause of action directly arises out of a contract which is not binding on the minor The Authority for this is lesie limited versus sh lesie is l s l i e limited versus sh s h e i l l but bear in mind this is at common law but in equity the minor can be compelled to restore that property to the person deceived if the property is identifiable and is still in the possession of the minor it means that if the minor deceives you to part with a property or money to that particular minor under the common law you can't bring an action to enforce the contract the money you can't recover it but under Equity we have been told that the manor can be compelled to restore the property if the property it's identifiable and is still in the possession of the minor and you know this particular rule admittedly it creates problems because it means that if the minor has deceived you to take some loan from you it means you can only recover the money from the minor if you have can identify the same notes and the same coins in the minor possession if the man has changed the money he has used the money and they G him change that money you can't recover it because that is not the one that you gave to the Min if has invested it and made profit you can't go back and recover it because that on the same money that he gave to the minor so take note of the rules in Lesly limited versus sh what about the right of a minor to enforce a contract against an adult party now you remember I had mentioned from the beginning that generally under the common law there are some agreements the general position is that when a minor enters into an agreement with an adult the minor can enforce against the out but then the out cannnot enforce against the minor and then I have given you exceptions of contract that the adult can enforce against the minor I have given you contract for necessaries and give you beneficial contract of service in your discuss voidable contract now apart from these three every other agreement that a minor enters into with an outdo party the outdo party cannot enforce against the minor what about the minor can the minor bring an action for specific performance against the outdo party the principle is that the minor can only bring an action to to obtain specific performance against an adult party if the minor has completely performed his side of the bargain in the contract and there's nothing more outstanding for the minor to do that is when the minor can bring an action against the adult for specific performance and the Authority for that is L versus banan this is what in some books you see it been referred to as mutuality of contract that you the minor we can't bring an action against you for specific performance so why would you want to bring it against the out the law is that only when you the minor you have completely performed your part of the contract there's nothing out standing for you to do then you can bring an action against the adult for specific performance The Authority is L versus B when a minor is bringing an action in the court of law can the minor bring the action by himself the law is that no if the minor is about to bring an action the minor must you through the Minor's next friend who must act through a lawyer or if the minor is being sued he must Su the the next friend or later and over here look at other five of the CI 47 is a minor liable for the thoughts you You' learned LW of thoughts you know there's battery assult Force imprisonment is a minor liable for their thoughts the law is that generally miners are not liable generally minor are allowable for their thoughts but where the cause of action is arising directly out of a contract which is not binding on the Infant then the minor will not be liable for that particular thought so take note miners are generally liable for their thoughts but where the cause of action in thoughts is arising directly out of a contract and that contract is not binding on the Infant the minor will not be liable for the thoughts what about the capacity of mentally incompetent persons people we have described as people who are not compos menst who are these people a person of on sound mind a person who you can describe as a mentally incompetent person or an insane person or a person who is not compos mens this is a person you can describe as a lunatic now when these people enter into contract an insane person a mentally incompetent person they enter into an agreement with you must the agreement be binding on them remember we mentioned there are times when they can be binding there are times when they cannot be binding let's see under what circumstance would the agreement entered into by a person who is in and what circumstance would that agreement not be binding on that person the case will use his Imperial loan versus Stone Imperial loan versus tone what what what do the court say the court laid down a two a twin test two test that you must meet before you can say that you are exonerated from liability under a contract because you are in s first is that you must prove that at the time of Contracting you were of unsound mind that is to say that you were incapable of understanding the nature of the contract due to the mental disability that you were incapable of understanding the nature of the contract due to the mental disability and and this fact must be known to the other Contracting party the other party must be aware that at the time of entering into the contract you were insane or you mentally incompetent so there are two things one is that you were actually insane and the fact of this Insanity must be known to the other party and the Authority for this is Imperial loan versus sto the burden of proving these two things lies on the person who claims to be mentally incapacitated now bear in mind when a mentally incapacitated person enters into a contract that contract is voidable at the instance of that particular person if it's vable what does it mean it means that it will continue to be valid unless the person take steps to resend the contract but you aware that there are some people who even though they are insane there are times when they are actually very sane so you see them as insane walking around as people who are mentally incompetent but there are time when they actually sa we call Lucid intervals there are time when they come back to their Resto to normaly and they appreciate whatever they are doing the law is that we describe that SP as a lucid interval or a lucid moment now a mentally incompetent person is liable for contract made during Lucid moment even when his disability is not known to the other party and the authority is Selby s e l b y versus Jackson so a mentally incompetent person is liable for contract made during the Lucid moments even when his disability is not known to the other party and then there this principle about mentally incompetent persons about when a supplier has given a mentally incompetent person necessaries with an incompetent person be required to pay for them many people think that once you mentally incompetent person regardless of the arguments enter into with you then it means you will not be it will not be enforceable against you but if you read that case of inry road road is r o d s it states that a mentally incompetent person is liable to pay for necessaries supplied to him where the suppli expected that the goods would be paid for regardless of whether the supplier was aware of his disability again a mentally incompetent person is liable to pay for necessary suppli to him where the supplier expected that the goods would be paid for regardless of whether the supplier was aware of his disability so people think that a mentally incompetent person when you go and buy food when you go and buy water and they are necessaries you cannot be seed to compel for you to be compelled to pay if you read the of in Roes r o Dees it tells us that a mentally incompetent person is liable to pay for necessaries supply to him what a supplier expected that the goods would be paid for regardless of whether the supplier was aware of his disability in real roads then the final thing under capacity is capacity of intoxicated persons what did you say about intoxicated persons remember that if it comes to the capacity of intoxicated persons is generally the same as that of mentally incompetent persons therefore if at the time of the contract a person was so drunk or intoxicated and he could not appreciate the nature and consequence of his act and this fact is unknown to the other party at the time of Contracting that contct entered into will be voidable at the instance of the drunken or the intoxicated party the drunking party has the option of ratifying the contract when he becomes sober that is the case of Mathews versus baar again a drunen person is under the same obligation as under as an insane person to pay a reasonable sum for goods that have been supplied it means that if you're an intoxicated person and you going to make an order for necessaries just ask your s for the insane person you to you'll be required to pay if the supplier expected you to pay with the goods other material on time remember these are the rules that relate to capacity to contract you must go over them as many times as you can there's a principle that you know that I have mentioned that you are not aware of quickly take the book revise it and take note of that one and move on but if you can remember all of them they are good to go this is where we shall draw the curtains for our invion on capacity to contract now next lecture we shall deal with Cy D thank you