Asked by
Emily Maldonado
on Nov 10, 2024
Verified
The case of Canadian Imperial Bank of Commerce v. Milhomens examined the effect of one party's insanity on a contract. What did the Court find?
A) For a contract to be voidable because of insanity, one party must be insane and the other party must have known (or ought to have known) of the insanity.
B) If a person has the mental faculties to sign a contract, that person cannot be insane.
C) If an insane person enters into a contract, that contract is automatically void.
D) Contracts are not enforceable by either party if one party can establish a mental defect.
E) The relevant test for insanity is simply whether one party believed the other to be insane at the moment the offer was made.
Canadian Imperial Bank of Commerce v. Milhomens
A specific legal case, likely involving legal principles or judgments pertaining to the entities named.
Insanity
A legal defense claiming that a defendant was unable to understand the nature of their actions or distinguish right from wrong due to mental illness at the time of their crime.
Voidable Contract
An agreement that has legal effect but that one of the parties has the option to end.
- Understand the circumstances in which contracts become voidable due to lacking capacity, mental disorder, or substance intoxication.
Verified Answer
LJ
Learning Objectives
- Understand the circumstances in which contracts become voidable due to lacking capacity, mental disorder, or substance intoxication.