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Business Law - Contractual Capacity

Having the ability to understand the terms of a contract and the consequences of non-performance is Contractual Capacity. Your Capacity rights grant you protection of contract when you lack capacity. When protected parties purchase things classified as necessaries (things needed to maintain life and lifestyle) the protected parties need pay only the fair market value rather than the contracted price. When these parties purchase non-necessaries (things that for them are relative luxuries) they must pay the contracted price, but the protected parties have the option to disaffirm the contract. Disaffirmance involves giving back the consider...