Australian Contract Law: Capacity and Validity of Contracts

Running head: REPORT 1
Principal of Business Governance
Student details:
4/22/2019

REPORT 2
Australian contract law concerns the legal enforcement of promise, which were made as the part
of bargain generously made entry into, creating the legal relations called the contract. For the
valid contract, every party to a contract should have contractual capacity. There are some types
of the individuals, who don’t have the ability to enter into contract. For an instance, the people
who have the mental disorder, they are not able to know the nature of a contract. These people
lack the contractual capacity. In every state including Australia, the requirement of age is to sign
the contract is eighteen years. The child under the age of eighteen is considered as minor. The
minor is not able to sign the contract except the contract is required to make for the essential
items. The essential items involve the medicine, foodstuff, and healthcare service. Or else, it is
required that the minor should have the assent of parents or custodian to make a contract
officially binding. The people below the age of 18 have a restricted capacity to take entry into
the contract. It means that the contract with minor is valid in certain conditions (Poole 2016).
Further, in a case where the minor child has signed the contract for non-essential items without
the consent of parents or guardians, then the contract is not valid. In different meaning, the
parents or guardians may contact any business and also have a contract cancelled. The valid
contracts is only so if the custodian or parents gave consent to a contract. Any items that the
children bought on the contract will require to be given back. Providentially, a retailer should
give back the item in spite of the policies related to return, since he or she breached the law of
state in permitting the minor to sign a contract in first place. Additionally, in a case where the
child is uncontrolled, meaning courts awarded them grown-up status when they were still
immature; in that case the contract is to be valid (Taylor and Matthew 2016).