Contracts Act · s 12

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s 12Sound mind for purposes of contracting

(1)

A person is said to be of sound mind for the purpose of making a contract if, at the time when he makes it, he is capable of understanding it and of forming a rational judgement as to its effect upon his interests.

Contracts 22

(2)

A person who is usually of unsound mind, but occasionally of sound mind, may make a contract when he is of sound mind.

(3)

A person who is usually of sound mind, but occasionally of unsound mind, may not make a contract when he is of unsound mind.

Illustrations

(a)

A patient in a mental hospital, who is at intervals of sound mind, may contract during those intervals.

(b)

A sane man, who is delirious from fever, or who is so drunk that he cannot understand the terms of a contract, or form a rational judgement as to its effect on his interests, cannot contract whilst such delirium or drunkenness lasts.