We address how the law regards children in contract law, including how and when contracts may be canceled.
What you’ll discover:
Can a minor sign a contract, and if so, is it legally binding?
Which types of contracts involving minors are legally binding?
How can minors cancel or nullify contracts?
What happens to a contract signed by a minor once the child attains majority?
Before entering a contract with a minor, be aware of your rights and duties.
Minors are those under the age of majority, which is 19 in Alabama and Nebraska and 18 in the rest of the country. Minors have little legal authority over their affairs since they are not considered adults under the law. Minors, for example, cannot vote, own property, or agree to medical treatment.
In most cases, minors depend on their parents, legal guardians, or other approved adults to manage such affairs. For example, on behalf of minor hospital patients, parents or legal guardians must sign a Permission for Medical Care of a Minor form.
Here, we explore how the law regards children in relation to contracts, including when and how contracts may be invalidated, as well as unique provisions for contracts deemed required for basic necessities.
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Table of Contents
Can a minor sign a contract, and if so, is it legally binding?
Minors may and do sign and enter into a variety of contracts, such as those for summer employment, performing roles, or automobile purchases. The question of whether these contracts are enforceable is more complicated. Since kids lack legal capacity as adults, the regulations governing how some kinds of contracts are enforced vary significantly from those governing contracts between adults.
Minors are often not bound to the terms of a contract until they attain the age of majority. In other words, even though the other party is an adult and is obligated by the conditions, a juvenile has the ability to opt out of a contract. As a result, from the viewpoint of the minor, a contract is usually a good faith agreement but not a legally binding one.
Which types of contracts involving minors are legally binding?
Contracts for some products deemed necessary to the well-being of a child are legally binding, which means the kid cannot simply opt out of them. Some of these goods (dubbed “necessaries”) are:
Food, clothing, shelter, transportation, and education
Assume a 17-year-old enrolls in college and pays for the first semester in advance. He changes his mind before the first lesson and seeks a refund, claiming that he lacked the legal ability to enroll in the first place. While schooling is often on the list of necessities, the minor may not be allowed to nullify the contract depending on the state.
Contracts involving children may also be enforceable if they include:
Bank regulations and taxes
Penalties, both civil and criminal
Service in the military
Here’s an illustration: After fleeing her family, a minor lies about her age in order to join the Army. She reconciles with her family and reconsiders, revealing to the recruiting office that she is a minor and hence unable to enroll. Despite of her change of heart, she may be unable to avoid her military obligation.
Minors may also be unable to cancel some sports and entertainment contracts, depending on state legislation. Professional sports leagues, for example, invest a significant amount of time and money on scouting and signing young players to high-profile contracts. With how much money professional leagues make and how teams are constructed, a minor opting out of a contract might inflict financial harm to a company.
How can minors cancel or nullify contracts?
When a contract is voidable, which means it is not for necessities, military service, or one of the other enforceable categories, minors have two options:
Filing a lawsuit to have the contract voided.
When being sued for breach of contract, defend yourself by claiming that you lack capacity.
It is important to note that minors cannot pick and choose between contract conditions. The only options are to invalidate the contract entirely or not at all. In reality, parties may avoid going to court by entering into a Mutual Rescission and Release Agreement. If a contract is canceled, the minor may be required to pay restitution or return things.
What happens to a contract signed by a minor once the child attains majority?
Contracts with children that are voidable in most jurisdictions become legally binding, or “ratified,” after the youngsters attain the age of majority. Several jurisdictions allow a youngster six months or so after becoming a legal adult to cancel such arrangements.
Before entering a contract with a minor, be aware of your rights and duties.
Although a kid can sign a contract, it may not be legally binding. Knowing your state’s laws before signing a contract as a minor or with a child can allow you to make educated choices and safeguard your interests. Ask a lawyer if you have any more inquiries concerning contract law or other legal issues.