Capacity To Contract Definition

Capacity To Contract

The legal ability to enter into a binding contract. Those who lack the capacity to contract include minors (with limited exceptions) and individuals who are so mentally impaired that they cannot understand the terms of the contract. If an individual who lacks the capacity to contract enters an agreement, that person may under most circumstances back out later. For example, if a 15-year-old signs a contract for cell phone service, the cell phone company won