In the previous installment of this series we discussed minor superhero and supervillain criminal liability. Today we’re going to talk about the contract liability of minors. Unlike crimes (and, as we shall see, torts), minors are often able to escape contract liability.
I. The General Rule
The common law rule is that “minors have the capacity to contract, at least when of sufficient age to understand what they are doing, but in general, they have the right to repudiate their contracts.” 42 Am. Jur. 2d Infants § 39; See, e.g., Hoblyn v. Johnson, 55 P.3d 1219, 1230 (Sup. Ct. Wy. 2002). In other words, a minor can enter a contract (and sue for breach), but in general he or she can also get out of the contract if he or she wants to.
Now you might think that this is a bit unfair. For example, what if an upstart supervillain contracts to buy a freeze ray, receives it, stiffs the seller, then repudiates the contract? The answer is that the supervillain has to give the freeze ray back if he or she wants to avoid the contract. See, e.g., Nelson v. Browning, 391 S.W.2d 873, 877 (Sup. Ct. Mo. 1965) The law may be stupid sometimes, but it’s not that stupid.
There is, however, a twist. What if the freeze ray was smashed in an altercation with a superhero? In that case the seller is out of luck. “If during infancy he has wasted or squandered the consideration, or has otherwise made away with it so that he is unable to restore it, he may nevertheless repudiate the contract without making a tender.” Id.
So why not require the kid to pony up the cash equivalent instead of getting away free and clear? Because “the privilege of repudiating a contract is accorded an infant because of the indiscretion incident to his immaturity, and if he were required to restore the equivalent where he has wasted or squandered the consideration received, the privilege would be of no avail when most needed.” Id. at 877-78. In other words, it’s all well and good to demand one’s freeze ray back because in a sense that doesn’t cost the kid anything, but giving back the cash equivalent would essentially be an enforcement of the contract since it would come out of the kid’s own pocket, which kinda defeats the point of the rule.
However, some courts have taken the view that merely selling or exchanging the received goods for something else doesn’t count. In other words, if our young supervillain exchanges the freeze ray for a heat ray of equal or lesser value, then in some states he might still be liable to return the heat ray (assuming he’s still got it and it hasn’t been smashed up, of course). See, e.g., Whitman v. Allen, 121 A. 160 (Sup. Jud. Ct. Me. 1923). And some courts depart from the general rule entirely and take the view that the minor is in fact liable for the value of the consideration received, even if the minor has to pay the cash equivalent out of pocket. See, e.g., Porter v. Wilson, 209 A.2d 730 (Sup. Ct. N.H. 1965).
The upshot of all of this is that entering into contracts with minors isn’t terribly wise most of the time. This why most contracts involving minors require the signature of a parent or legal guardian.
II. Some Exceptions
The major exception, extending back to the common law, is that a minor can be bound for a contract for “necessaries.” Necessaries are not precisely defined in most jurisdictions, but as a rule of thumb they are things like food and shelter that the minor actually needs and actually uses. For example, a hotel room is not a necessary when a minor has access to a perfectly good home, but if the minor would otherwise be stranded outside and does indeed use the hotel room, then that’s a necessary. As you can imagine, this would mostly apply to the practical requirements of a young superhero or supervillain living on his or her own; the rule wouldn’t apply to something like a freeze ray, since nobody really needs one.
Note, however, that the liability for necessaries is generally limited to the reasonable value of the good or service, not the contracted price. See, e.g., Williams v. Baptist Health Systems, Inc., 857 So.2d 149 (Ct. Civ. App. Ala. 2003). This is because the liability for necessaries is not based on contract but rather quasi-contract, the distinction between which is beyond the scope of this post.
Of course, the common law can be modified by statute, and in many states it has been. For example, in California a minor cannot make a contract relating to real property (i.e. real estate) or make a contract relating to personal property not under his or her immediate possession or control. Cal. Civ. Code § 6701 (2009).
Finally, things get especially complicated when you consider cases where a person makes a contract while a minor but then seeks to repudiate it after turning 18.
The rule that minors may be liable for their torts, responsible for their crimes, and yet often not liable for their contracts may seem a bit unfair. The practical conclusion is for adults to be wary of contracting with minors, and indeed this is why many legal actions require a parent or legal guardian to be involved (NB in such cases it is the adult who is bound, not the minor). But in the right jurisdiction, a wily young supervillain–especially one able to project the appearance of adulthood–might be able to abuse this defense for fun and profit.