A buyer and seller sign a contract for deed. Two weeks later, the buyer is declared mentally incompetent. The buyer's guardian suggests continuing payments. Which is true?

• A. The buyer can finish out the contract as the guardian proposed
• B. The contract is terminated and cannot continue
• C. The seller can sue immediately for breach
• D. The guardian must get court approval before continuing payments

Answer: (A)

When a buyer under a contract for deed becomes mentally incompetent, a guardian is appointed to manage that person’s affairs. In a contract for deed, the buyer’s obligation to make payments continues, and the seller’s risk is mitigated by the seller retaining title until payoff. The guardian can oversee and continue those payments because that duty protects the ward’s assets and keeps the contract alive. This preserves the deal, avoids unwinding the agreement, and allows the ward to complete the purchase if circumstances permit later. Terminating the contract or treating it as breached would disrupt the protected rights of the ward, and seeking immediate damages isn’t appropriate while the guardian can continue the established payments. While guardianship actions are supervised by the court, routine continued payments under the contract fall within the guardian’s fiduciary duties, so no automatic court approval is required merely to keep paying.