Question

Although contracts are generally enforceable, last week we learned that there is an exception to this general rule. In particular, the law will protect minors from the enforcement of contracts that may not be in their best interests.   As such, business may not be able to enforce contracts that they enter into with minors. Does this seem fair? From whose point of view?

Answer 1

This does seem fair but only from the point of view of the minor and the society (and not from the point of view of the businesses). This is because minors, by definition, are not mature enough yet to understand the full implications of many types of contracts including financial contracts. As such, it is entirely possible for a business to make a contract with a minor which is to deteriment of the minor. For example, an online servie may get a contract of buying a 10 year long subscription service from them at a rate that will increase 10% each year. A minor may not understand the exact implication of it and get into the contract. Even worse examples could be of contracts that take away their wealth, enforce them to do illegal acts etc. Even if the intent is not malicious from the business's side, minors often dont understand what they are getting into. So its often not in the best interest of minors to have the contracts completely enforceable.

It is also not good for society as a whole since such contracts can often become burden on the parents on the minor, or such contracts may hinder the social, educational and financial development of the minors and hence create long term issues for everyone.

Due to the above reason, it is entirely fair that contracts with minors may not be enforceable.