Contracts I, Pages 505โ€“512

G.A.S. v. S.I.S.

Family Court of Delaware, New Castle County, 1978

Facts:

Plaintiff and defendant were married with four children. Plaintiff was hospitalized for mental health problems on multiple occasions. These problems involved paranoia and loss of a sense of reality and afterwards extreme dependency. During one of these episodes, defendant consulted an attorney to secure a legal separation. She agreed to stay with plaintiff if he took his medicine. Regardless, she filed for divorce during his next reoccurrence.

Plaintiff consulted a lawyer briefly, but wanted to reconcile. However, while he was committed to the hospital, defendant's lawyer drafted a separation agreement, which plaintiff signed without asking about its contents. At the hospital he was on medication which adversely affected his reasoning powers. Plaintiff had been very cooperative with defendant because he was hopeful to reconcile the marriage. Plaintiff also relied on defendant to transport him and manage all of his money.

Issues:

  • Whether plaintiff had the legal capacity to contract on that date

  • If so, whether th agreement should be rescinded as a result of either constructive fraud or undue influence on the part of the defendant.

Rule:

[R2C ยง 177]

Reasoning:

  • Plaintiff was not legally mentally incompetent, and thus the contract was not void, but it may help make it voidable.

  • Plaintiff wanted to reconcile with defendant, relied on defendant for his needs, and was vulnerable because of his mental illness and treatment. Defendant therethrough dominated plaintiff.

Holding:

The agreement should be canceled and declared nullity.