A person entirely without understanding has no power to make a contract of any kind, but the person is liable for the reasonable value of things furnished to the person necessary for the support of the person or the person’s family.
PersonsPersons with Unsound Mind
Section § 38
This law says that if someone doesn't have the mental capacity to understand anything at all, they can't make any contracts. However, they are still responsible for paying for things they or their family need to live, at a fair price.
mental capacity understanding contract power
Section § 39
This law explains that a contract or agreement made by someone who isn’t fully mentally capable, but not completely incapable, can be undone if their mental incapacity wasn't legally confirmed at the time. There's also a rule that if a person can’t handle their finances or is easily tricked, it’s presumed they aren’t of sound mind. However, small mistakes alone don't prove this lack of ability.
(a)CA Civil Law Code § 39(a) A conveyance or other contract of a person of unsound mind, but not entirely without understanding, made before the incapacity of the person has been judicially determined, is subject to rescission, as provided in Chapter 2 (commencing with Section 1688) of Title 5 of Part 2 of Division 3.
(b)CA Civil Law Code § 39(b) A rebuttable presumption affecting the burden of proof that a person is of unsound mind shall exist for purposes of this section if the person is substantially unable to manage his or
her own financial resources or resist fraud or undue influence. Substantial inability may not be proved solely by isolated incidents of negligence or improvidence.
unsound mind contract rescission mental incapacity
Section § 40
This law says that if a court decides a person is not mentally capable, they cannot make any legal agreements or give up any legal rights until they are considered capable again. Also, if a court appoints a conservator (a person who manages another's affairs), it officially means that person is not able to make their own legal decisions.
(a)CA Civil Law Code § 40(a) Subject to Section 1871 of the Probate Code, and subject to Part 1 (commencing with Section 5000) of Division 5 of the Welfare and Institutions Code, after his or her incapacity has been judicially determined a person of unsound mind can make no conveyance or other contract, nor delegate any power or waive any right, until his or her restoration to capacity.
(b)CA Civil Law Code § 40(b) Subject to Sections 1873 to 1876, inclusive, of the Probate Code, the establishment of a conservatorship under
Division 4 (commencing with Section 1400) of the Probate Code is a judicial determination of the incapacity of the conservatee for the purposes of this section.
mental incapacity conveyance prohibition legal agreements
Section § 41
If someone has a mental illness or impairment, they can still be held responsible for harm they cause, unless they didn’t understand their actions were wrong. They won’t face additional punishment damages unless they knew it was wrong at the time.
A person of unsound mind, of whatever degree, is civilly liable for a wrong done by the person, but is not liable in exemplary damages unless at the time of the act the person was capable of knowing that the act was wrongful.
unsound mind liability civil liability mental illness responsibility
