1. Dodson vs. Shrader Presented by Group 2: Scott, Gregor, Mishala, Michael, and Olga

3. Facts Defendant is Shrader Plaintiff is Dodson Dodson borrowed $4900 from his girlfriends grandmother On April 7, 1987, Dodson, who was 16 at the time, purchased a truck from Shrader for $4900 In December, 1987 Dodson was told by a mechanic that there was a burned valve in the engine Dodson continued to drive truck with the burned valve until January, when the engine blew up, and stopped operating

4. Facts On may, 10, 1988 Dodson sued Shrader in general sessions court Dodson has agreed to return the truck to Shrader but the Shraders refused to return the purchase price of $4900 The Shraders wanted the truck plus the difference in value from when Dodson purchased it. After the Sharders refused to return the original $4900 purchased price for the truck. The truck was still in possession of Dodson when it was damaged in a hit and run while it was parked on the street

5. Timeline April 7th, 1987 Dodson bought truck for $4900 from Sharders January 1988 Truck engine “blew up” May 10th 1988 Dodson sued Sharders in General Sessions Court December 1987 Dodson discovered truck had burned valve Dodson borrowed money from girlfriends grandma Later date Truck was damage by hit and run

6. Questions at Issue Is the contract voidable to Dodson, and is Dodson entitled to get his money back.

7. POV: Economic Should minors be allowed to rip companies off? If minors bought vehicles only to ruin them and demand their money back, not only would companies go out of business, but they just might stop selling them to minors. In a 2002 study the national estimated annual cost of automobile crashes involving young drivers each year is $32,000,000,000. Are minors not responsible enough to purchase and take care of vehicles?

8. POV: Plaintiff Dodson believes that because he is a minor and in no way misrepresented his age, he has the right to disaffirmance--(The exercised power of avoidance which releases the minor from any liability on the contract) and the right to get his money back

9. POV: Defendant Shrader sold the truck assuming Dodson was at least 20 years of age. Shrader believes it is Dodsons negligible actions toward the car that resulted in the vehicles failure to continue it's mobility. Shrader knows he is in no way responsible for this minors actions. He did not want to rescind the contract because the car had depreciated in value due to Dodson’s actions.

10. Precedent Case #1 Wheaton v. East, 13 Tenn. 40, 61 Cited Keane v. Boycott, 2 H. Black, 511 If the contract is not in the best interest of the minor, it is void. If the contract is to the minor’s benefit in regard to necessities, it is good. If the benefit or prejudice (negative impact) of the contract is unknown, it is voidableonly at the election of the minor.

11. Precedent Case #2 Grace v. Hale, 21 Tenn. 26, 29-30 Necessities for which a minor can bind himself or herself by contract include the following: Diet Apparel Washing Lodging Schooling Medicine Some specific contracts falling into these categories may in fact not be “necessities”, depending on the fortune and circumstances of the minor.

12. Precedent Case #3 1926, Giddens v. Etheridge Co., Inc., 2 Tenn. App. 324 Cited Grace v. Hale An automobile is not a necessary The fact that the subject automobile was useful and even perhaps a necessary for the plaintiff’s circumstances does not make it a necessary in regard to the law

13. Precedent Case #4 Bentley v. Haimans Ready to Wear, 1 Tenn. App. 280 In this case, Bentley purchased a dress and wore it for nine months Bentley lost, because the dress was clearly apparel, for which, according to Grace v Hale, the minor could be required to pay for

14. Precedent Case #5 Rose v. Sheeham Buick, Inc., Fla.1967, 204 So.2d 903 In this case, the minor could not disaffirm the purchase of an automobile because he had used the vehicle to carry on his school business and social activities, resulting in the determination that the automobile was a “necessary”. This decision held that the mere fact that the minor appeared to be of age did not constitute a misrepresentation sufficient to prevent disaffirmance.

15. Precedent Case #6 Matherson v. Davis The plaintiff executed a deed three months before her majority. For three years after majority, she expressed satisfaction with the deal and never disaffirmed the deed. She then died. The Supreme Court held that the deceased, a married woman, could not informally affirm her deed made while a minor, so long as she continued under the then existing disabilities of coverture. In this case, the court held that ‘the privilege of infancy is to be used as a shield and not a sword.” Generally, in order for an adult to disaffirm a contract entered into while a minor, they must restore the consideration received.

16. Additional Precedent Cases Magnolia Courts, Inc. v. Webb 470 S.W.2d 16, 18 (1970) Gardner v. Flowers, 529 S.W.2d 708 (1975) Western Union Telegraph Co. v. Ausbrooks, 418 Tenn. 615, 257 S.W. 858, 33 A.L.R. 330 (1924) Foster v. Adcock, 161 Tenn. 217, 30 S.W.2d 239 (1930) Tuck v. Payne, 17 S.W.2d p. 9 Harwell Motor Company v. Cunningham, 337 S.W.2d 765 (1959) Wheaton v. East

17. Identification of a Necessary529 S.W.2d 709-710 A precise definition is not desirable or necessary, and could not cover all possible cases. A minor must be in actual need of the goods or services in question. The be in need of the goods or services depends on these factors: The nature of the goods or services The minor’s need for the goods or services at the time Whether the minor has sources, other than his or her own credit, for supplying the needed goods or services

18. The Law 43 C.J.S., Infants, Section 166, pp. 448, et seq. As a general rule, an infant has not the capacity to bind himself absolutely by a contract, or is not bound by his contract. Such was the rule at common law, and under some statutes, infants are not to free to contract for themselves, except in cases provided for . . . It is the policy of the law to protect infants against their own mistakes or improvidence, and from designs of others, and to discourage adults from contracting with an infant. A person who deals with an infant does so at his peril, whether or not he has actual or constructive notice of the infant’s disability.

19. The Law 43 C.J.S., Infants, Section 172, pp. 448, et seq. The right of an infant to avoid or disaffirm a contract is absolute and unconditional. It may be exercised regardless of the reasonableness of the contract, or of the motive in doing so, and is not affected by the presence of good faith on the part of the other party to the transaction. The contract may be avoided as against an assignee thereof, as the avowed purpose of the rule permitting disaffirmance by a minor is to protect and safeguard the minor’s property or funds. The rule relating to the avoidance of infants’ contract should be liberally applied. However, infancy is said to act as a shield and not as a sword, and the privilege of disaffirmance should serve as a shield and not as an instrument of oppression.

20. The Law 43 C.J.S., Infants, Section 175, pp. 448, et seq. As a general rule, in order to give effect to an infant’s disaffirmance of his contract, it is not necessary to place the other party in status quo. Hence, except as may be provided otherwise by statute, a restoration or tender of what the adult party to the contract has parted with, or its value, generally is not regarded as a condition precedent to avoidance, unless at the time of disaffirmance the infant has the fruits of the contract in his possession or within his control; but there is also authority to the contrary. Nevertheless, where he has exercised his right to repudiate the contract, the infant may be required to return the consideration, if he can, or such part thereof as still remains in his hands or under his control, for the law will not allow him to repudiate his contract and at the same time retain its fruits or benefits as his own, especially where the benefits are tangible. It has been said that, as long as the infant retains and does not restore the consideration received by him, he may be treated as a trustee of the other party, and the infant would be liable for any tortious use or disposition of the property after avoidance and before its surrender to those from whom it was obtained. Where the infant disposed of, lost, or wasted the consideration or a part thereof during his infancy, he cannot be required to make good to the other party the consideration, or such part, and the other party must take it in the condition in which he finds it. It has been said that on disaffirming a contract for purchase of equipment or machinery, on the ground of infancy, the infant is obligated to account for reasonable use or depreciation of the value of such equipment or the machine in his possession, such as a motor vehicle, although there is authority to the effect that an infant is not required to account for use or depreciation of the property while in his possession.

21. Consequences The main consequences are that Dodson walked away costing the Shraders more money when he drove the truck to the point the engine blew. Minors should learn to taking responsibility of their possessions and not ruin it for the everyone by suing companies for their mistake. Businesses aught to be extremely careful upon going into contracts with minors without a parental signature guaranteeing payment.

22. Group Opinion We believed this case turned out how it should have, Dodson got to return the truck but it had to be in the same condition as received or had to pay for damages out of the 4900.