Can a Minor Enter into a Contract?

Minors or those who are not of legal age generally can’t enter a valid contract. This means that an agreement is not enforceable against an underage, even if all the key elements of a legally binding contract are found.

However, there are few exceptions. According to Minors Act 1970 No. 60, contracts with minors are allowed only for the following reasons:

For employment
For necessities

Keep in mind though, that even if you contract with a minor under these exceptions, you cannot enforce such contracts against them once they decide to back out of the agreement. If they decide to renege on the first contract, you have no choice but to let them go.

Contracts for Employment of Minors

There are underaged individuals, especially those who are sixteen and older, who want or need to work to afford some necessities or luxuries that their parents may not be able to pay for.

In employing a minor, however, an employment contract should still give some protection to the minor. This agreement must not be unfair or oppressive in any way to the underaged worker.

In this kind of contract, the minor must have every right to renounce the contract once they reach legal age. If the minor does not renounce that agreement, this legal document will remain a binding contract.

Contract for Necessities

This contract includes different things that a minor might need. Below are only some of these needs:

Food
Housing
Proper clothes
Education
Health care
Extracurricular activities like music lessons, sports, and art classes

With this kind of contract, it’s crucial to note that if a minor is already receiving a certain need through any other means, a new agreement for that same necessity might not be necessary anymore.

Can you enforce a contract against a minor?

Keep in mind that if you enter a contract with a minor as the other party (either for necessities or employment) and they decide to back out of the contract, you can’t enforce that agreement against them.

But again, there are a few possible exceptions to this rule:

First exception

The first one is if you have an agreement with both the minor and the parents or legal guardians. In this circumstance, if the minor breaks out of the contract, you might have a claim against the other signatories.

Second exception

This situation occurs if the contract is for land or a partnership between an adult and an underage. The contract will remain viable until the minor decides and takes the right steps in stepping out of the contract.

But until then, the agreement is still enforceable.

You can enforce a contract only if…

There are certain circumstances when a contract is enforceable with a minor. Below are those possibilities:

If the minor reaches legal age and affirms the contract

This is a self-explanatory one. Just make sure that the affirmation made by the minor is written in a contract. You must also include a piece of evidence that the minor now has the legal capacity to enter a contract and that he or she fully understands the conditions of the enforceable contract.

If the minor enters a fresh agreement

In some parts of the world, if the minor enters a new contract while still a minor, there’s a possibility that you can enforce that contract against them.

However, keep in mind that this circumstance is not acceptable in all of Australia. That’s why whenever you are entering a contract with a minor, it’s best if you consult legal experts who know the ins and outs of this subject. Check out Gibbs Wright Litigation Lawyers for more information.