Arthur had been adjudicated insane. During his period of insanity, Arthur sold s

Question

Arthur had been adjudicated insane. During his period of insanity, Arthur sold some unimproved real estate to Katrina for $5,000, its fair value. Katrina did not know that Arthur was insane. In fact, he acted perfectly normal in every way. Arthur spends this $5,000. Arthur's guardian learns of this transaction and sues to void the contract and recover the land. What results? a. Because Arthur was acting normally, can because Katrina did not know of his insanity, the contract is valid. b. The guardian can get the land back, but Arthur must pay Katrina the $5,000. c. The guardian can get the land back but since Arthur has spent the $5,000, Arthur does not need to give anything back to Katrina. d. Because Arthur received the fair value for his land, the contract cannot be voided.

Explanation / Answer

Option (B)-Mental incompetence is the inability of a person to make or carry out important decisions regarding his or her affairs. When a person is judged to be incompetent, a guardian is appointed to handle the person's property and personal affairs.In the instant case the guardian can get the land back, but Arthur must pay Katrina the $5,000.

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