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29 Cards in this Set
- Front
- Back
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Voluntary Consent
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a valid contract may still be unenforceable if the parties have not genuinely agreed to its terms
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Mistakes
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Mistakes of Fact and Mistakes of Value or Quality
(only a contract of fact makes a contract voidable) |
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Unilateral Mistakes
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Mistakes made by only one of the contracting parties:
- does not give the mistaken party any right to relief from the contract - TWO EXCEPTIONS: ---> If the other part to the contract knows or should have known that a mistake of fact was made, the contract may bot be enforceable ---> If mistake was due to a mathematical mistake, and was made inadvertently and without gross (extreme) negligence |
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Bilateral (Mutual) Mistakes
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When both parties are mistaken about the same material fact, the contract can be rescinded by either party (never meeting of the minds)
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Fraudulent Misrepresentation
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Innocent party is fraudulently induced to enter into a contract, the contract usually can be avoided because she or he has not voluntarily consented to the terms
THREE ELEMENTS: 1. A misrepresentation of a MATERIAL fact must occur 2. There must be an intent to deceive 3. The innocent party must justifiably rely on the misrepresentation |
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Misrepresentation Has Occurred
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A fact is objective and verifiable; an opinion is usually subject to debate
- Misrepresentation by Conduct - Misrepresentation of Law - Misrepresentation by SIlence |
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Intent to Deceive
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Knowledge on the part of the misrepresenting party that facts have been misrepresented. (scienter/"guilty knowledge")
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Reliance on the Misrepresentation
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The deceived party must have a justifiable reason for relying on the misrepresentation, and it must be an important factor in inducing the party to enter into the contract
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Injury to the Innocent Party
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(most courts do not require a showing of injury when the action is to rescind the contract
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Undue Influence
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A contract entered into under excessive or undue influence lacks voluntary consent and is therefore voidable
Can arise from confidential or fiduciary relationships There must ne clear and convincing evidence that the person did not act out of her or his free will |
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Duress
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Forcing a party to enter into a contract because of the fear created by threats.
The threatened act must be wrongful or illegal. (threatening to exercise a legal right usually does not constitute duress |
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The Statute of Frauds
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(Writing Requirements) Stipulates what types of contracts must be in writing or be evidence by a record
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Contracts Involving Interests in Land
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A form of real property, real estate, which includes not only land but all physical objects that are permanently attached
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The One-Year Rule
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Contracts that CANNOT by their own terms, be performed within one year from the day after the contract is formed - must be in writing
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Collateral Promises
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Promise made by a third party to assume the debts or obligations of a primary party to a contract if that party does not perform
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Primary versus Secondary Obligations
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Contract in which a party assumes a primary obligation normally DOES NOT need to be in writing to be enforceable.
Contract in which a party assumes a secondary obligation DOES have to be in writing to be enforceable |
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An Exception - The "Main Purpose" Rule
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An oral promise to answer for the debt of another is covered by the Statute of Frauds unless that guarantor's purpose in accepting secondary liability is to secure a personal benefit
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Promises Made in Consideration of Marriage
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Prenuptial Agreements - agreements made before marriage that define each partner's ownership rights in the other partner's property (must be in writing)
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Contracts for the Sale of Goods
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The Uniform Commercial Code (UCC) requires a writing or memorandum for the sale of goods priced at $500 or more
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Exceptions to the Statute of Frauds
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-Partial Performance: if the purchaser has paid part of the price, taken possession, and made valuable improvements to the property
-Admissions: if a party against whom enforcement of an oral contract is sought admits in pleadings, testimony, or otherwise in cour proceedings that a contract for sale was made, the contract will be enforceable -Promissory Estoppel: the promisee has justifiably relied on it to her or his detriment |
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What Must Be Contained In Writing?
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A memorandum or note evidencing the oral contract need only contain the essential terms of the contract, not every term.
Also must be some indication that the parties voluntarily agree to the terms Only the party against whom enforcement is sought must have signed the writing |
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The Parol Evidence Rule
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A party cannot introduce in court evidence of the parties' prior negotiations, prior agreements, or contemporaneous oral agreements if that evidence contradicts or varies the terms of the parties' written contract
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Contracts Subsequently Modified
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Evidence of a subsequent modification of a written contract can be introduced in court
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Voidable or Void Contracts
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Oral evidence to show that the contract was voidable or void
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Contracts Containing Ambiguous Terms
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Courts allow evidence to show the meaning of terms
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Incomplete Contracts
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Courts allow evidence to "fill in the gaps" in contract
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Prior Dealing, Course of Performance, or Usage of Trade
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Evidence can be introduced to explain or supplement a written contract by showing a prior dealing, course of performance, or usage of trade
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Contracts with an Obvious Clerical Error
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When an obvious or gross clerical error exists that clearly would not represent the agreement to the parties, parol evidence is admissible to correct the error
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Integrated Contracts
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Whether the written contract is intended to be a complete and final statement of the terms of the agreement (either completely or partially integrated)
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