Question

At 17, Otto signed a contract to purchase a new Hummer by advancing a payment of s50.000. However, when Otto turned 20, he wished to disaffirm this contract Does the law permit this? O A. Yes, because he was a minor when he signed the contract. O8. Yes, because he is not yet 21 years of age C. No, because a car is a "necessary D.No, because Otto implied his ratification.

Answer 1

B. Yes.

Generally, a minor, or a person who has not yet reached legal age of majority, is not legally required to carry out the terms of any contract he or she might enter. The minor retains the right of disaffirmance of the contract. Only the minor retains this right; the other party remains bound by the contract.

Otherwise, a minor retains the right of disaffirmance of any contract into which he or she enters, whether or not it has already been performed. Once that minor reaches the age of majority, any contract that he or she has entered into prior to the age of majority must be either disaffirmed within a reasonable but predetermined period of time, or ratified.

In order to disaffirm a contract made before he or she reached the legal age of majority, the minor must state, either in writing or orally, his or her intention not to honor the contract. If the minor acts in such a way as to indicate to a reasonable person that he or she has no intention to honor the contract, that can count as disaffirmance, too. However, once the minor has reached legal age, if he or she does not disaffirm the contract within the time limit, the contract becomes ratified, and the entire contract becomes binding to both parties.