Capacity to contract: Transactions of infants
Tamara is a 16-year-old student of Government Secondary School, Port Harcourt. Quite frequently, he patronises D-Line Pharmacy & Stores on the same street as his family home. All the members of his family are well known to Pharmacist Donald and the staff of the pharmacy.
To get some relief from a recurring headache, Tamara goes to the pharmacy to buy some painkillers. Unfortunately, he does not have money on him at the time; so he takes the medication on credit with a promise to pay later. He also collects a bottle of perfume and adds to his bill.
The following day, on his way back from school, Tamara stops at D-Line Pharmacy & Stores to pick up five more bottles of perfume. He explains that they are required as Christmas gifts for his friends at school. He is given the additional bottles of perfume on the condition that his entire bill will be settled by the end of the week.
Two weeks after, Tamara is yet to return to the pharmacy to pay his bill. Incidentally, his mother comes to purchase anti-malaria drugs and is informed of her son’s outstanding debt. Pharmacist Donald demands that Mama Tamara settle the bill for the unpaid painkillers and perfumes. Mama Tamara refuses to pay, claiming that the sale of goods to her son is unenforceable because Tamara is still a minor. In view of this, what is the legal consequence of the transaction?
As previously stated, a contract is an agreement which is binding at law. However, even when all the ingredients of a valid contract are present, it may not be enforceable against certain categories of people like infants, lunatics, drunkards and the illiterate. The general rule at common law was that contracts made by an infant were voidable at his option, i.e. not binding on the infant but binding on the other party.
The issues to be considered in this case are:
- The meaning of infant.
- The legal position of contracts made by infants.
- The meaning of necessaries.
The position of contracts made by infants has been modified at common law by the Infants Relief Act of 1874 as follows:
(a) The Act specifically declares that three particular types of contracts with infants are absolutely void:
(1) contracts of loan, i.e., lending money to an infant;
(2) contracts for goods (other than necessary goods); and
(3) accounts stated.
(b) Secondly, the Act stipulated that it would no longer be possible for an infant to ratify at majority, those contracts which were formerly not binding on an infant unless ratified by him after the attainment of majority. In other words, if he now ratifies such contracts, such “ratification” has no legal effect.
The first issue to be determined is who is an infant? The age of twenty-one has been fixed at common law as that at which absolute and unlimited legal capacity to contract shall commence. Persons below that age are, therefore, infants for the purpose of contractual transactions.
In the case of Labinjoh v. Abake, a Nigerian adult sued to recover from the defendant, a Nigerian girl, the balance due to the plaintiff for the goods sold and delivered to the defendant. On appeal to the Full Court, the court confirmed that the Infants Relief Act was a statute of general application in force in Lagos. It therefore follows that, for matters governed by English law, the correct age of majority is twenty-one.
The second issue to be addressed is the legal consequence of contracts made by infants. The summary of the Infants Relief Act of 1874 is as follows:
(a) All contracts of loan for non-necessary goods and accounts are absolutely void.
(b) Contracts for necessary goods and beneficial contracts of service remain absolutely binding on the infant.
(c) Contracts which are binding on the infant, unless repudiated by him either during infancy or within a reasonable period after the attainment of majority, remain unchanged and unaffected by the Act. These are contracts in which the infant acquires an interest in property, with continuing obligations, such as the purchase of land, leases, renting of an apartment, purchase of shares in a company, partnership agreements, etc.
(d) Contracts which were not binding on an infant, unless ratified by him after the attainment of majority, were no longer ratifiable by him after majority. In other words, such contracts become void.
In the matter of Tamara and D-Line Pharmacy, there was a purchase of painkillers and perfumes. These two sets of items would be treated differently. As it can be proven that the painkillers were necessary for use by the buyer (who was a minor); the perfumes, on the other hand, would be seen to be luxury goods.
Section 2 of the Sale of Goods Act provides that, “where necessaries are sold and delivered to an infant, or minor or to a person, who by reason of mental incapability or drunkenness is incompetent to contract, he must pay a reasonable price, thereof.” By this provision, Tamara would be liable to pay for the medication he bought, since those items were necessary.
The Sale of Goods Act defines necessary goods as “goods suitable to the condition in life of such an infant or minor or other person, and to his actual requirements at the time of sale and delivery.” In the case of Chapple v. Cooper, Judge Alderson stated that “things necessary are those without which an individual cannot reasonably exist… thus, articles of mere luxury are always excluded, though luxurious articles of utility are in some cases allowed.”
In conclusion, the sale of painkillers to Tamara was a valid transaction for which he is liable. However, the perfumes are luxury items, the sale of which would not be binding on Tamara, being that he is a minor (below the contractual age of twenty-one).
Principles and cases are from Sagay: Nigerian Law of Contract