the names of the partners composing it. The laws of most states provide that one or more persons may associate themselves under any name they choose to assume for business purposes, and upon recording it in the proper offices together with their own names and addresses may do business and contract under the assumed name.

A person would bind himself if he contracted under an assumed name. The other party might not be bound, if he

was deceived.

Generally all persons are able to bind themselves by contract. It is a positive right. But there are exceptions to the general rule. Certain persons are not competent to contract, and certain other persons have only a qualified right to make contracts.

If a person has been legally declared a lunatic or a spendthrift, and a guardian has been appointed by the court to look after his property, such person has no power to enter into a binding contract. No agreement made by him could be enforced, even though the person dealing with him did not know that he was insane or a spendthrift and had been legally declared incompetent. There is one exception to this rule-a contract to buy absolute necessities for life and health. A person may supply an insane person with necessary things and will be legally entitled to payment for them.

As it is necessary for a party to give his free consent to an agreement and to know what he is consenting to, intoxicated and insane persons who have not been legally declared to be such, cannot make enforceable contracts if the insanity or the intoxication prevents them from understanding the nature of their acts at the time the contract is entered into.

The Law Varies with Location. This question of competency depends on the law of the place where the contract was made. If a person legally declared a spendthrift should go into another state, he would be perfectly capable of making

contracts there until he has been declared a spendthrift in the courts of that state. A person legally declared insane, if he had lucid intervals, might in a state other than that in which he had been declared insane make an enforceable contract in a lucid interval. The age at which a person becomes legally competent to contract varies in different states. The local law should always be consulted.

Indians. Indians living on government reservations are protected by the federal law, and may make enforceable contracts only under such conditions as that law prescribes. If they leave the reservations and enter into ordinary business relations, they are usually held liable in the same way as any other business men.

Married Women. A married woman does not have entire freedom of contract. As a usual rule a married woman cannot make an enforceable contract with her husband. Formerly a married woman could not make a contract at all without her husband's consent, but this has been changed. It is safest to consult the law of the state in which one resides before entering into a contract with a married woman, as a few states still give her a measure of irresponsibility. A married woman may, in any state, act as an agent for her husband. (See § 128.)

Minors. Minors (persons who are under legal age, which is generally 21) have only a qualified ability to make contracts. That is to say, the minor may make a contract but the other contracting party cannot enforce it if the minor chooses not to perform his part. The minor may even annul the contract after it has been performed, return the property and demand his money back, or vice versa. If the minor has taken a fraudulent advantage of the other person by leading that person to think he is of full age, the law will later prevent the minor from stating that he is under age when he comes into court, and will therefore make him perform

his agreement. If under the contract the minor has received property or money from the other party, he will be made to repay or to return it if possible; but if he has spent or otherwise disposed of it he may, as a rule, still refuse to repay or return it.

People dealing with young persons are supposed to look out for their own interests and to find out whether such parties are of age or not. The minor, because of his inexperience, is guarded by the law not only against the designs of other persons but also against his own carelessness. He is not, however, guarded against his own wrong-doing. If he injures property he will be obliged to pay damages.

After a minor has come of age he may confirm any contracts made while he was a minor. He may do this either by words or by acts. If he keeps the property obtained under such a contract for an unreasonable length of time, however, the court will consider that he has confirmed it. Moreover, unless the minor pleads his infancy in court, a contract may be enforced against him as against any other person. No one else may plead this for him. If he becomes insolvent, a receiver of his property may not call off any of his contracts for him, no matter how unfair. If the minor himself chooses to stand by them, they are legally binding.

Note:

I. It is not safe to have any business dealings with a minor.

$39. The Subject Matter Must Be Lawful

The subject matter of a contract is that which the agreement is about. It may consist of any property, commodity, or service which could be the subject of a business transaction, or it may be to do or not to do something, such as to pay for the privilege of naming a child, or to pay a young man to abstain from using tobacco.

An agreement to do anything contrary to law would be unenforceable. An agreement to do anything which, while not directly contrary to any special statute, would be injurious to the peace and good order, the health, or the morals of the community, would be against public policy and would be unenforceable.

The following agreements would be contrary to law or to public policy and therefore unlawful:

I. An agreement to prevent a person from marrying or to break up a marriage.

2.

other.

An agreement to persuade one person to marry an

3. An agreement in restraint of trade. The Supreme Court has decided that agreements in reasonable restraint of trade are not contrary to public policy. Where a person sells out his business to another he may agree not to engage in that business again within certain reasonable territorial limits and for a limited time, but the majority of the cases in this country condemn contracts to restrain trade throughout the entire state or in the entire country for an indefinite period. It is considered to be against public policy that the people of the whole state should for any length of time he deprived of the industry and skill of anyone engaged in a useful employment.

4. Gambling contracts. Contracts for the buying and selling of "options" and "futures" and of stock "on margin," are regarded as gambling contracts in some states, and will not be enforced unless the party selling the stock was in some way entitled to it or was selling it as agent for the real owner.

Fire insurance can be taken out on property only by a party who has some interest in it, and life insurance only by the party insured, his wife, child, or some other person who would be entitled to support, or by a creditor who had a claim against the person whose life was insured, or by a

business partner or employer. Otherwise it would merely amount to a wager as to whether the property would be destroyed or when the person would die.

5. Contracts in which usurious interest is charged. Sometimes the contract itself will be enforced, but the party will be prevented from collecting interest; sometimes he will not be allowed to enforce any part of the contract.

6. Contracts to commit a fraud or a crime.

7. Contracts for the sale of adulterated goods.

8. Contracts to bribe public officials, or contracts of bribery with such officials.

9. Agreements by candidates to appoint persons to positions in case said candidates are elected, or to do anything else in return for aid in securing their election.

10. Agreements not to prosecute a person for a crime.

All of these last cases are contrary to public policy because the subject matter pertains to something unlawful and injurious to the community.

II. An agreement made in advance not to take a dispute into court. The law favors the settling of disputes out of court as much as possible; but it is contrary to public policy to deprive any man in advance of his right to be heard in court whether by agreement or otherwise. But, while two parties may not contract to refrain from taking a possible disagreement to court, they may contract to arbitrate in a specified manner before the court is resorted to.

12. A contract to perform services in return for money made by a medical student before he has been licensed, by a law student before he has been admitted to the bar, or by any other person who is required by the law to submit to certain requirements before being licensed to practice his profession or vocation and who is not yet so licensed, is void; any fees which may have been agreed upon cannot be collected.

When an illegal contract has been made, the courts will