Also known as: disaffirms · disaffirmed · disaffirming · disaffirmance · disaffirmation · repudiate · avoid contract
Written by attorneys · grounded in primary & secondary sources — see below
A power to repudiate a voidable transaction such as a contract or gift. The power belongs to a party lacking capacity, most commonly a minor, or arises on other grounds making the transaction voidable, and may be exercised before majority or within a reasonable time afterward. Failure to exercise the power within a reasonable time after reaching majority constitutes ratification.
National Oil obtained appointment of a receiver over Alpha Oil's maintenance yard after default. The receiver collected rents, paid taxes, and made repairs. Creek Power later secured its own receiver. National Oil's receiver retained the net rents for the junior obligation because the senior receiver had not yet been appointed.
Tyler, age seventeen, signed title to a semi-truck over to Pioneer Transit as a gift. After turning eighteen, Tyler continued occasional use of the truck for several months. Tyler then notified Pioneer that he disaffirmed the transfer and demanded return of title.
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Sixteen-year-old Douglass signed an employment agreement with a car dealership. After reaching majority, Douglass continued working for four months without objection. Douglass then gave notice that he disaffirmed the contract and sought to recover wages already earned.
Junior Mortgagee secured a receiver who collected fifty thousand dollars in net rents after taxes and repairs. Senior Mortgagee later obtained appointment of its own receiver. The junior receiver retained the fifty thousand dollars for the benefit of the junior mortgagee.
A submitted a bid omitting fifty thousand dollars from its total. After beginning work, A discovered the error and disaffirmed the contract on grounds of mistake. A then sued for restitution measured by the reasonable value of performance already rendered.
Sally Beauty received an exclusive distributorship from Nexxus. After a change in ownership, Sally Beauty sought to disaffirm only the exclusivity term while retaining the underlying supply relationship. The court required disaffirmance of the entire agreement or none at all.
Failure to disaffirm within a reasonable time after reaching majority constitutes ratification of the transaction. The former minor is then bound as though the contract or gift had been made by an adult.
No. A minor must disaffirm the entire contract. Partial disaffirmance that retains ongoing benefits is not permitted.
No. Parental consent or signature does not, by itself, eliminate the minor's power to disaffirm unless a specific statute or doctrine authorizes the parent to bind the child.
In most jurisdictions the minor may recover consideration paid without restoring the value of consumed or intangible benefits. Some courts allow an offset for use and depreciation when the original transaction was fair.
…of particular articles of property, a mistake or misapprehension as to the quality of the articles will not enable the vendor to repudiate the sale. The foregoing are all the authorities relied on as supporting the positions taken by my brethren in this case. I fail to discover any similarity between them and the present…