1887

n South African Law Journal - Minors as the payees of cheques

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Abstract

This article deals with the difficulties that arise when a minor is designated as the payee of a cheque. The main issue is whether a minor falls within the ambit of the phrase 'a person not having capacity to contract' in s 5(3) of the Bills of Exchange Act 34 of 1964. In order to arrive at a conclusion, the authors draw a distinction between the position where a minor below the age of 7 years (infans) is the designated payee and the position where a minor who has reached the age of 7 is the designated payee. In respect of a minor over the age of 7 years a further distinction is drawn between a minor's capacity to enter into a contract that confers only rights on him or her and a contract that imposes obligations on the minor. The effect of a minor's emancipation is also discussed. The authors point out that it is not clear whether the phrase 'not having capacity to contract' refers only to having no capacity to contract at all - as is the case with an infans - or whether it extends to not having full capacity to contract - as is the case in respect of a minor over the age of 7 who enters into a contract that imposes obligations on him or her. The authors analyse the relevant legal principles and offer their conclusions on the matter. They also set out the implications for collecting banks.

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/content/ju_salj/124/1/EJC53736
2007-01-01
2016-12-06
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