Limited legal capacity
Die limited legal capacity is a central concept in German civil law. It describes the ability of a natural person to enter into legal transactions only to a limited extent and not with full legal effect. Limited legal capacity is particularly significant for minors aged seven up to and including seventeen years. The following provides a detailed explanation of the legal basis, exceptions, typical case scenarios, as well as practical implications.
Legal Basis
Statutory Regulation
The provisions relating to limited legal capacity can be found in particular in Sections 104 et seq. of the German Civil Code (BGB). Under German law, a distinction is generally made between persons who are incapable of contracting, persons with limited capacity to contract, and persons with full legal capacity:
- Incapable of contracting (Section 104 BGB): Persons under seven years of age and permanently mentally ill individuals
- Persons with limited legal capacity (Section 106 BGB): Minors from the completion of their 7th birthday up to the age of majority (18th birthday)
- Full legal capacity (Section 2, Section 104 No. 2 BGB): Persons upon completion of their 18th year of age
Section 106 BGB explicitly regulates:
“A minor who has reached the age of seven has limited legal capacity in accordance with Sections 107 to 113.”
Purpose of Limited Legal Capacity
The purpose of limited legal capacity primarily lies in the protection of minors participating in legal transactions. It aims to ensure that minors are not disadvantaged by hasty or detrimental legal transactions or do not enter into obligations whose consequences they cannot foresee.
Effects of Limited Legal Capacity
Principle of Pending Ineffectiveness
A legal transaction entered into by a person with limited legal capacity without prior consent from their legal representative is initially ‘pending ineffective’ according to Section 108 BGB. It only becomes effective upon subsequent approval by the legal representatives (parents or guardian). If approval is not granted, the transaction is ultimately void.
Exceptions to the Consent Requirement
However, there are significant exceptions in which a minor with limited legal capacity can make or receive legally effective declarations of intent:
1. Consent of the legal representative
According to Section 107 BGB, a legal transaction that brings only a legal advantage is effective without the consent of the legal representative. For example, this includes a gift without obligation or additional conditions.
2. ‘Pocket Money Clause’ (Section 110 BGB)
Another significant exception is the so-called Pocket Money Clause. According to this, contracts in which the minor fulfills the contractual obligation with their own funds (money provided for free disposal by representatives or with their consent from third parties) are effective from the outset.
3. Transactions within an employment or service relationship (Section 113 BGB)
Persons with limited legal capacity who are permitted by their parents or guardian to take up employment or a service relationship may independently conclude all legal transactions associated with this. Thus, they are to be treated as fully capable of contracting in this respect.
4. Transactions that are solely legally advantageous
Minors can validly accept declarations of intent that are solely legally advantageous (e.g., receiving a gift) without the consent of parents or other representatives.
Practical Implications of Limited Legal Capacity
Conclusion of Contracts
Persons with limited legal capacity can, for example, enter into purchase contracts. However, the effectiveness of the contract depends on whether the legal representatives agree, or it falls under one of the exceptions listed above (pocket money, merely legal advantage, etc.).
Receipt and Submission of Declarations of Intent
In addition to concluding contracts, limited legal capacity also affects the receipt and submission of declarations of intent. The relevant regulations ensure that the interests of minors are adequately protected.
Validity and Reversal
If a pending ineffective transaction is not approved by the legal representative, there is an obligation to return benefits in accordance with the principles of the law of unjust enrichment (Sections 812 et seq. BGB).
Special Cases and Further Regulations
Capacity for Tortious Liability
Limited legal capacity is to be distinguished from the so-called Capacity for Tortious Liability capacity for tortious liability. While legal capacity relates to the effectiveness of declarations of intent, capacity for tortious liability governs civil liability for unlawful acts (Sections 823 et seq. BGB).
Effect in Legal Transactions
In everyday legal transactions, limited legal capacity means that, in dealings with minors, it must always be checked whether the statutory requirements for the validity of the transaction are met. Businesses, online shops, landlords, and other contracting parties should be aware of the risks of transactions that are pending ineffective.
Private International Law
In an international context, legal capacity is generally determined according to the personal statute, i.e., the respective nationality of the minor. Differences between legal systems must be taken into account.
Summary
Limited legal capacity is a fundamental principle of German civil law that protects minors in legal transactions, yet does not completely exclude their participation. The statutory provisions allow for a finely balanced protection and, at the same time, limited legal capacity for action among adolescents. This legal status primarily exists between the ages of 7 and 18 and is associated with extensive consequences for minors, their parents, and contracting parties.
Further Laws and Regulations
- German Civil Code (BGB) – Sections 104-113
- Introductory Act to the German Civil Code (EGBGB)
- Further case law and literature relevant to the legal status of persons with limited legal capacity
Note: The above statements provide a comprehensive overview of limited legal capacity in German law and highlight the most important legal aspects, special features, and practical implications.
Frequently Asked Questions
Which legal transactions are valid for persons with limited legal capacity without the consent of the legal representative?
Persons with limited legal capacity—generally minors between the completion of their seventh and eighteenth year (Section 106 BGB)—can also enter into some legal transactions without the consent of their legal representative (usually the parents) with legal effect. This applies in particular to so-called ‘legally advantageous’ transactions (Section 107 BGB). These include all transactions whereby the minor does not suffer any legal disadvantage, for example, gratuitous transfers (such as gifts), provided that no further obligations are involved. In addition, contracts may be valid if they were concluded with funds provided for the free disposal by parents or, with their approval, by third parties (‘Pocket Money Clause’, Section 110 BGB). Legal transactions are also effective if they occur with the representative’s consent or are subsequently approved by the representative (Section 108 BGB). Especially in the case of employment contracts, their validity may depend on specific legal conditions (Section 113 BGB).
What is the effect of a legal transaction concluded without the required consent of the legal representative?
A legal transaction entered into by a person with limited legal capacity without the required consent of the legal representative is pending ineffective (Section 108 (1) BGB). This means that the transaction is initially neither valid nor definitively void. It is, so to speak, waiting for a decision. If the required consent of the legal representative is subsequently granted (approval), the transaction becomes effective retroactively. If the legal representative refuses approval, the transaction remains void. Until a final decision is made, the transaction is in a state of suspense in which neither party can derive enforceable rights or obligations from the transaction.
What is the difference between “consent” and “approval” in connection with limited legal capacity?
“Consent” (Section 183 BGB) refers to prior approval given by the legal representative for a specific legal transaction by the person with limited legal capacity. If consent is given before the contract is concluded, the transaction becomes immediately effective upon conclusion. In contrast, “approval” (Section 184 BGB) refers to subsequent approval of the contract. If the minor has entered into a transaction without prior consent, it remains pending ineffective until the legal representative subsequently approves or refuses it. The timing of the approval (before or after) therefore determines whether effectiveness occurs immediately or at a later point in time.
What is meant by the “Pocket Money Clause” and what is its significance?
The so-called ‘Pocket Money Clause’ is set out in Section 110 BGB and constitutes a significant exception to the general requirement of the legal representative’s consent. According to this, contracts are effective if the person with limited legal capacity fulfills them with means that have been given to them for free disposal—such as regular pocket money, money gifts, or small earnings from permissible work. The prerequisite is that the transaction is fulfilled fully and immediately with the minor’s own means (i.e., without installment payments or later performances as is the case with credit transactions). This is intended to allow everyday purchases or small acquisitions without the parents necessarily having to give consent each time.
Can persons with limited legal capacity also independently conclude employment contracts?
Persons with limited legal capacity may, in principle, enter into employment relationships independently with the consent of their legal representatives in accordance with Section 113 BGB. With this consent, full legal capacity applies in the professional context in respect of all legal transactions connected to the employment relationship (e.g., regarding termination or receipt of wages). However, the parents’ or guardian’s consent can be revoked, which would restore the limited legal capacity in this area. Relevant youth employment protection provisions that restrict the employment of minors must also be observed.
What are the consequences if a minor with limited legal capacity enters into a contract that is legally disadvantageous for them?
If a minor with limited legal capacity concludes a contract that obligates or disadvantages them legally (e.g., by purchasing a good with installment payments), this contract is pending ineffective without the consent of the legal representative (Sections 107, 108 BGB). It only becomes effective once the legal representative subsequently approves it. If approval is refused, the contract remains void. During the period of suspense, the other contracting party may withdraw from the transaction or demand approval.
What is the significance of limited legal capacity in online shopping?
Limited legal capacity applies fully to the area of e-commerce as well. Minors may only validly conclude contracts for goods or services on the Internet within the scope of the described exceptions—in particular, through immediate and full payment with their own money (‘Pocket Money Clause’) or with (prior or subsequent) consent of the legal representative. Contracts with longer payment terms, subscriptions, or credit transactions are generally excluded by the general rule and are pending ineffective if parental consent is lacking. In such cases, the provider bears the risk and may insist on compliance with the specific legal requirements.
