One who in a proper proceeding has been judicially declared to be a lunatic, drunkard, or spendthrift, and placed under a guardianship, is thereby deprived of his legal capacity to contract.3 The quasi contractual obligation resulting from a contract thereafter attempted to be entered into by him, is therefore governed by the considerations set forth in this chapter.

1 Strain v. Wright, 1849, 7 Ga. 568; Badger v. Phinney, 1819, 15 Mass. 359; 8 Am. Dec. 105.

2 Boody v. McKenney, 1844, 23 Me. 517, 525; Nielson v. International Text Book Co., 1909, 106 Me. 104; 75 Atl. 330; Brawner v. Franklin, 1846, 4 Gill (Md.) 463 ; Chandler v. Simmons, 1867, 97 Mass. 508; 93 Am. Dec. 117; Miller v. Smith, 1879, 26 Minn. 248; 2 N. W. 942; Lake v. Perry, 1909, 95 Miss. 550; 49 So. 569, 570-73. In some cases it has been held that unless the infant can and does restore the consideration he has received, he has no right, in the absence of fraud, to restitution from the other party: Holmes v. Blogg, 1818, 8 Taunt. 508; Adams v. Beall, 1887, 67 Md. 53; 8 Atl. 664; 1 Am. St. Rep. 379; Johnson v. Northwestern Mut. Life Ins. Co., 1894, 56 Minn. 365; 57 N. W. 934; 59 N. W. 992; 26 L. R. A. 187; 45 Am. St. Rep. 473; Heath v. Stevens, 1869, 48 N. H. 251; Holden Taft & Co. v. Lineville Pike, 1842, 14 Vt. 405; 39 Am. Dec. 228; cf. Price v. Furman, 1855, 27 Vt. 268; 65 Am. Dec. 194. But the weight of authority is to the contrary: Manning v. Johnson, 1855, 26 Ala. 446; 62 Am. Dec. 732; Reynolds v. McCurry, 1881, 100 111. 356; Shirk v. Shultz, 1887, 113 Ind. 571; 15 N. E. 12; Morse v. Ely, 1891, 154 Mass. 458; 28 N. E. 577; 26 Am. St. Rep. 263; Harvey v. Briggs, 1890, 68 Miss. 60; 8 So. 274; 10 L. R. A. 62; Lacy v. Pixler, 1894, 120 Mo. 383; 25 S. W. 206; Englebert v. Troxell, 1894, 40 Neb. 195; 58 N. W. 852; 26 L. R. A. 177; 42 Am. St. Rep. 665; Green v. Green, 1877, 69 N. Y. 553; 25 Am. Rep. 233; Lemmon v. Beeman, 1888, 45 Ohio St. 505; 15 N. E. 476.

3 Bradbury p. Place, 1887, (Me.), 10 Atl. 461; Rannells v. Gerner, 1883, 80 Mo. 474, (insane); Wadsworth v. Sharpsteen, 1853, 8 N. Y 388; 59 Am. Dec. 499, (drunkard). And see Wait v. Maxwell, 1827, 5 Pick. (Mass.) 217; 16 Am. Dec. 391, (insane). In some States it is held that an adjudication merely raises a presumption of incapacity to contract which may be rebutted. See Mott v. Mott, 1891, 49 N. J. Eq. 192; 22 Atl. 997, (insane); In re Gangwere's Estate, 1856, 14 Pa. St. 417; 53 Am. Dec. 554, (insane).

Without the adjudication above referred to, insanity or intoxication, according to the better view, does not affect legal capacity to contract. If it is such as results in mental incapacity to form a rational estimate of the legal consequences of his act, the insane or drunken person or his representative, like the infant, may be permitted to avoid the contract.1 But, differing from the case of an infant, he is required, as a rule, to place the other party in statu quo as a condition precedent to avoidance.2 If the other party knew of the mental condition of the incompetent, the latter may avoid the contract, though he has disposed of the consideration:3 and in a few jurisdictions an incompetent who has disposed of the consideration may avoid, even as against a person who dealt with him in ignorance of his condition.4 In neither of these cases, it seems, may restitution in value be enforced.

Sec. 71. Same: (4) Corporations

It is one view of ultra vires contracts that they are void because of a corporation's legal incapacity to make them, just as a married woman's contracts were void at the common law. They are more properly regarded, however, as illegal rather than as void for want of capacity, and quasi contractual obligations resulting from them are considered in another chapter (post, Sec. 154 et seq.).