Business Law Chapter 13

Front 1

genuineness of assent

Back 1

Te requirement that a party's assent to a contract be genuine

Front 2

Rescission

Back 2

An action to undue a contract

Front 3

Unilateral mistake

Back 3

A mistake in which one party is mistaken about a material fact regarding the subject matter of a contract. Three types:
1. One party makes a unilateral mistake of fact, and the other party knew (or should have known) a mistake was made.
2. A unilateral mistake occurs because of a clerical or mathematical error that is a result of gross negligence.
3. The mistake is so serious that enforcing the contract would be unconscionable.

Front 4

Mutual mistake of fact

Back 4

A mistake made by both parties concerning a material fact that is important to the subject matter of a contract.

Front 5

Material fact

Back 5

Fact important to the subject matter of a contract.

Front 6

Mutual mistake of value

Back 6

A mistake that occurs if both parties know the subject of the contract but are mistaken as to its value.

Front 7

Fradulent misrepresentation

Back 7

An event that occurs when one person consciously decides to induce another person to rely and act on a misrepresentation Also called fraud.

Front 8

To prove fraud what are the elements?

Back 8

The wrongdoer made a false representation of material fact.
The wrongdoer intended to deceive the innocent party.
The innocent party justifiably relied on the misrepesentation.
The innocent party was injured.

Front 9

Material misrepresntation of fact.

Back 9

must be of a past or existing material fact. It has to have a significant factor in inducing the innorent party to enter into the contract.

Front 10

To have fraud you have to have

Back 10

A material misrepresentation of fact, intent to deceive, reliance on misrepresentation, and injury to the innocent party

Front 11

fraud in the inception

Back 11

Fraud that occurs if a person is deceived as to the nature of his or her act and does not know what he or she is signing.

Front 12

Fraud in the inducement

Back 12

Fraud that occurs when the party knows what he or she is signing but has been fraudulantly induced into entering the contract.

Front 13

silence as misrepresentation

Back 13

1/ nondisclosure would cause bodily injury or death.
2. there is a fiduciary relationship (of trust and confidence) between contracting parties.
3. Federal and state statutes require disclosure.

Front 14

Innocent misrepresentation

Back 14

Fraud that occurs when a person makes a statement of fact that he or she honestly and reasonably believes to be true even though it is not.

Front 15

Duress

Back 15

A situation where one party threatens to do a wrongful act unless the other party enters into a contract.

Front 16

Undue influence

Back 16

A situation in which one person takes advantage of another person's emotional, mental, or physical weakness and unduly persuades that person to enter into a contract; the persuasion by the wrongdoer must overcome the free will of the innocent party.

Front 17

Elements that must be shown to get undue influence

Back 17

A fiduciary or confidential relationship must have existed between the parties.
And the dominant party must have unduly used his influence to persuade the weaker party to enter into the contract.