Halbman contracted to buy a car for $1250 from Lemke.Before he had paid off the car, it
broke down and he took it in to be repaired (costing $637).He didn't pay the repair bill, and
the garage came after Lemke as the title-holder of the car.
At the time, Halbman was still a minor.
Halbman paid Lemke $1000 cash and had paid another $100 in
installments at the time the car broke down.
Lemke then endorsed the title to Halbman to try to avoid
liability for repairs.
Halbman returned the title and disaffirmed the contract.Halbman wanted all the money back
that he had paid so far.The
car stayed at the garage for a few months, then it was towed back to the
Halbmans' house.Halbman called
Lemke a few times to try to get him to take back the car, but Lemke
refused.
While still at Halbman's house, the car was vandalized beyond
repair.
Halbman was able to disaffirm the contract under the infancy
doctrine (aka the doctrine
of incapacity), which protects minors
from "foolishly squandering their wealth through improvident
contracts with crafty adults who would take advantage of them in the
marketplace."
Infancy doctrine only
applies to purchase of items which are not necessities.
Halbman sued Lemke for $1,100, the amount he had paid under the
disaffirmed contract, and Lemke countersued for $150, the amount unpaid on
the contract.
The Trial Court found for Halbman.
The Trial Court held that when a minor disaffirms a contract, for the purchase of an item, he
need only return the property in his hands without needing to make
restitution for use or depreciation.
Lemke had unsuccessfully argued that he should be entitled to
recover for the damage to the vehicle up to the time of disaffirmance, which he claimed equaled the amount of the
repair bill.
The Appellate Court affirmed.
The Wisconsin Supreme Court affirmed.
The Wisconsin Supreme Court found that Lemke was seeking restitution of the value
of the depreciation by virtue of damage to the vehicle prior to
disaffirmance.This would
require Halbman to return more than that remaining in his
possession.It seeks
compensatory value for that which he cannot return.
The basic rule is that when a minor disaffirms, the situation reverts to what it was before
the contract was made.In
this case, Halbman would get his money back and Lemke would get his car
back.But in this case, the
car was damaged, so is responsible for the damage?The minor, or the seller?
In this case the Court said that Halbman has to return the car (in
whatever condition it is in), but he gets all of his money back.
If you can get a driver's license in Wisconsin at 16, why do
the courts feel that they are too irresponsible to buy a car until age
18?
Most of the time, there is not a problem with remedy when a
minor disaffirms a contract,
especially in executory contracts.
A bilateral contract (a binding exchange of promises) is called
an executory contract during the
time before anything has happened yet.
