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32 Cards in this Set

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What is misrepresentation?

Above statement or fact; can be fraudulent, negligent or innocent.

What is material misrepresentation?

Apple statement that induces someone to enter into a contract.

Define fraudulent misrepresentation

when a person makes a false statement knowing it is

Define negligent misrepresentation

When a person should have known the statement was false

Define innocent misrepresentation

When the false statement is made without malice

What is the remedy for innocent misrepresentation?

Rescission, Returns the parties to the position they were in prior to the contract. Damages are not available because both parties are innocent.

What are the remedies for fraudulent misrepresentation?

Recession and damages awarded for the tort of Deceit. Damages can be awarded win or session is not available, can also seek punitive damages.

What is the remedy for negligent misrepresentation?

Damages

Define duress

A person is induced into a contract by threats of violence or imprisonment, can also be threats to personal property or Goods. Must prove threat was the main inducement or entering into the contract

What is the remedy for duress?

Voidable contract, victim of a voidable contract may be denied a remedy if it would jeopardize a third-party.

Define undue influence

When pressure from a dominant trusted person make it impossible to bargain freely.

What is the remedy for undue influence?

The contract is voidable

Explain mistake

An error surrounding the contract that destroys consensus, must go to the root of the contract. Contract is void

Explain shared mistake

When two parties are in complete agreement with both have made the same mistake regarding some aspect of the contract, usually a fundamental aspect of the contract.

What happens with contract with a shared mistake?

The contract is void for lack of consensus, and the steak as to the value of the contract usually does not affect the enforcer ability of the contract.

What is the remedy for shared mistake?

If the written contract does not reflect the common intention of the party it's the courts can correct it.

Explain misunderstanding

When we the party is aware of the others a different understanding of the contract.

How is a misunderstanding remedied?

Court will apply the reasonable person test to determine which interpretation of the contract is more reasonable. Contract will only be declared void if both interpretations are reasonable and the court cannot decide between them

Explain one-sided mistake

Only one party is making a mistake to the contract

How is one-sided mistake remedied?

The general rule is if there is no Miss River representation or misleading information by the other party there is no recourse.

Caveat emptor applies. Let the buyer beware

What is the parol evidence rule?

Generally courts do not permit outside evidence to determine the meaning of a contract term. There are some exceptions.

What is privity of contract?

Only parties to a contract are bound by the contract. Third parties cannot enforce it or be bound by the terms.

What are the exceptions to privity of contract?

Original party to the contract can enforce it when the benefit is to be bestowed on an outsider, land, agent, trust, constructive Trust, Novation, principled exception

Explain the exception to privacy of original party to a contract can enforce it when the benefit is to be bestowed on an outsider.

If Peter hires a landscaping company to mow Sarah's lawn Sarah cannot enforce the contract but Peter can.

Explain the land exception to privity

Rights run with the land

The person who purchased a house with the renter must honor the lease of the renter

Explain agent exception to privity

Contract is between the principal and the other Contracting party

Explain trust exception to privity

One person transfers property to another for the benefit of a third party. The third party or beneficiary can enforce the agreement

Explain consecutive trust exceptions to privity

I trust inferred by the courts even though the parties did not specifically create one.

Explain Novation exception to privity

When the parties agree to substitute a third party for one of the original parties

Explain principled exception to privity

Contract extends to third parties when it makes sense the contract was intended to extend to them.

Example. An exemption Clause can be extended to employees of a Contracting party.

Explain assignment

The transfer of rights under a contract to another person.

What are the limitations of assignment

Only benefits can be signed, assignee is in no better position than assignor