If an incapacitated party accepts benefits after gaining capacity, what doctrine applies?

• A. Estoppel
• B. Disaffirmation
• C. Modification
• D. Reformation

Answer: (A)

Acceptance of benefits after regaining capacity creates estoppel, because it amounts to ratification by conduct. When someone who was incapacitated later acquires capacity and accepts the benefits of a contract that was formed during incapacity, they affirm the agreement. That affirmation prevents later claims of lack of capacity and disavowal of the contract. In this way, estoppel blocks disaffirmance and binds the now-capable party to the deal.

Disaffirmation would only apply if the party attempted to reject the contract; by taking the benefits, they’ve shown assent. Modification and reformation deal with changing or correcting terms of a contract, not with the enforceability of a contract entered into during incapacity and subsequently ratified by acceptance of benefits.