The Capacity to Contract (theory)

The capacity to contract refers to the legal ability of individuals or entities to enter into agreements that are enforceable by law. For a contract to be valid, parties must have the mental competence to understand the terms and consequences, be of a certain age (usually 18), and not be under duress or undue influence. Certain groups, like minors or individuals with severe mental impairments, may have limited capacity. In essence, capacity ensures that all parties involved in a contract can legally commit to their promises and obligations.