Business Law Capacity And Genuine Assent

Understanding Contractual Capacity and Assent in Contract Law

What Is Assent in a Contract?

Assent in a contract refers to the agreement and understanding between the parties involved. It signifies that both parties have willingly and consciously entered into the contract, fully aware of its terms and implications.

Types of Assent

• Genuine Assent: Real and complete understanding and agreement to the contract's terms.
• Bilateral Mistake: When both parties misunderstand the contract's terms.
• Unilateral Mistake: When only one party misinterprets the contract's terms.

Contractual Capacity

Contractual capacity refers to the legal ability of an individual to enter into a binding contract. Factors that affect contractual capacity include:

• Age: Minors generally lack contractual capacity.
• Mental Capacity: Individuals with impaired mental abilities may not have the capacity to contract.
• Intoxication: Contracts entered into while intoxicated may be voidable.

Consequences of Lacking Genuine Assent or Contractual Capacity

If genuine assent or contractual capacity is lacking, the contract may be:

• Void: No legal effect.
• Voidable: One party can choose to cancel the contract.
• Reformed: The court may modify the contract to reflect the parties' true intentions.

Conclusion

Understanding the concepts of genuine assent and contractual capacity is crucial in contract law. Contracts entered into without genuine assent or by individuals lacking contractual capacity may face legal challenges. Attorneys can advise on the specific circumstances and potential remedies in such cases.