Is it okay for minors to enter into a contract? Is it allowed if they are supervised by an adult? Can a minor enter into a contract to purchase a property for their parents?
Generally, only individuals with legal capacity can enter into a contract. This means that minors, persons of unsound mind, and persons deprived of civil rights are not capable of contracting. (Civil Code section 1556.) However, under Family Code section 6700, a minor is permitted to enter into certain types of contracts. Excluded are contracts related to the delegation of power, such as a power of attorney, real property or any interest in real property, and personal property not in the immediate possession or control of the minor.
While a minor may enter into certain types of contracts, except as those provided above, in the same manner as an adult, the minor also has the power to disaffirm the contracts before he reaches the age of majority or within a reasonable time thereafter. In other words, even though a minor is permitted to enter into certain types of contracts, those contracts are generally voidable by the minor. Thus, the minor can cancel the contract at any time before he reaches the age of eighteen or within a reasonable time thereafter. Generally, the minor is not required to restore any of the consideration he received under the contract. However, the minor is entitled to recover everything paid under the contract.
On the other hand, if a minor enters into a contract related to the delegation of power, real property or interest therein, or personal property that he does not control or is not in immediate possession of, then those contracts are void from the beginning. In other words, the minor does not need to disaffirm those contracts. Moreover, just as with voidable contracts, the minor is not required to return the consideration he received to enter into those contracts but is entitled to recover everything paid under the contract.
The policy behind this law is two-fold. First, the Legislature wants to protect minors from their own carelessness and others who seek to take advantage of their naivete. Second, the Legislature wants to discourage adults from contracting with minors. Essentially, adults who enter into contracts with minors do so at their own risk.
Schorr Law has a great deal of experience dealing with void or voidable contracts and can help you with these types of disputes. We have experience dealing with minor’s signing contracts in the real estate context. To schedule a consultation with one of our attorneys, please give us a call at (310) 954-1877. You can also email us at firstname.lastname@example.org or send us a message through our contact form.