Contractual Capacity Requirements
Summary
Under Section 11 of the Contracts Act 1950, a person must be of the age of majority, sound mind, and not legally disqualified to form a binding contract. In agency law, an agent must have authority to act on behalf of the principal. If an agent acts without authority, the principal is not bound by the contract unless they choose to ratify it. If not ratified, the agent may be personally liable for any breach. Understanding these principles can help clarify rights and liabilities in agency relationships.Full Conversation
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Under Section * of the Contracts Act *, the elements of legal capacity to form a binding contract are:
- The person must be of the age of majority (18 years or older).
- The person must be of sound mind.
- The person must not be disqualified from contracting by any law to which they are subject.
Would you like more details on any of these elements?
Ms. Dan appointed Mr. Tan as his agent to sell his property. However, Mr. Tan entered a contract on behalf of Ms. Dan without proper authority, resulting in legal complications. Ms. Dan is now seeking clarification on her rights and liabilities in this agency relationship.
a. Discuss the principles of an agency law in relation to Ms Dan's property dispute.
Under the principles of agency law:
*. Authority of Agent: An agent must have the authority to act on behalf of the principal. If Mr. Tan acted without proper authority, Ms. Dan is not bound by the contract.
*. Ratification: Ms. Dan can choose to ratify the contract, making it valid despite the initial lack of authority.
*. Liability: If the contract is not ratified, Mr. Tan could be personally liable for any breach of contract.
Would you like more information on how Ms. Dan can proceed legally?