Section 12
What is a sound mind for the purposes of contracting
A person is said to be of sound mind for the purpose of making a contract if, at the time when he makes it, he is capable of understanding it and of forming a rational judgment as to its effect upon his interests.
(2)
A person who is usually of unsound mind, but occasionally of sound mind, may make a contract when he is of sound mind.
(3)
A person who is usually of sound mind, but occasionally of unsound mind, may not make a contract when he is of unsound mind.
(a)
A patient in a mental hospital, who is at intervals of sound mind, may contract during those intervals.
(b)
A sane man, who is delirious from fever, or who is so drunk that he cannot understand the terms of a contract, or form a rational judgment as to its effect on his interests, cannot contract whilst such delirium or drunkenness lasts.