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What does it mean for a party to lack the capacity to make a valid contract? What kinds of people lack capacity in this sense?

What does it mean for a party to lack the capacity to make a valid contract? What kinds of people lack capacity in this sense? If a person lacks capacity is the contract automatically void? Why did the Government and Courts rule a Minor under 18has a right to get out of a Contract,even though they may understand and be more intelligent than most adults as to the Contract terms and responsibilities

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