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in California, petitioner’s residence,7 see Smalley v. Baker, 69
Cal. Rptr. 521, 527 (Ct. App. 1968); Cal. Prob. Code sec. 812
(West Supp. 2002), and in most other States, see 1 Restatement,
Contracts 2d, sec. 15 (1981), although a “compulsion” or
“irresistible impulse” standard has been applied on occasion, see
Faber v. Sweet Style Manufacturing Corp., 242 N.Y.S.2d 763 (Sup.
Ct. 1963). Undue influence, taking advantage of a contracting
party’s impaired ability to make rational decisions, may provide
a ground for rescission if the other party had actual knowledge,
see Smalley v. Baker, supra, or reason to know, see 1
Restatement, Contracts 2d, supra, of the putative incompetent’s
vulnerability.
Under all formulations of the standard, the person seeking
to avoid the contract has the burden of proving his incompetence.
See Cal. Prob. Code sec. 810(a) (West Supp. 2002); Holman v.
Stockton Savs. & Loan Bank, 122 P.2d 120 (Cal. Ct. App. 1942);
Faber v. Sweet Style Manufacturing Corp., supra at 766; 1
Restatement, Contracts 2d, supra, Illustration 1(c) (1981). In
6(...continued)
Commissioner, 101 T.C. 374, 384 (1993) (Form 872-A), affd.
without published opinion 40 F.3d 385 (5th Cir. 1994); Schulman
v. Commissioner, 93 T.C. 623, 639 (1989) (Form 872-A); Korff v.
Commissioner, T.C. Memo. 1993-33 (Form 870-P).
7We note that, on the arguably related issue of an
individual’s competence to litigate in this Court, the Court’s
Rule 60, which is patterned on Fed. R. Civ. P. 17 and was adopted
in its present form in 1973, looks to the law of the individual’s
domicile. 60 T.C. 1094; see supra note 2.
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