Vitiating Factors (and their remedies)

Question 1

What is a vitiating factor?

Answer 1

• Something that makes a contract null or void

Question 2

What are the two types of vitiating factors?

Answer 2

• Misrepresentation
• Economic Duress

Question 3

What is misrepresentation?

Answer 3

• Being encouraged into a contract form a false statement
• Cannot be a mere opinion, an expression of future intent or a mere trade puff
• Can be written or said
• Cannot arise from silence
• If made after formation of contract then not legally enforceable
  Types
• Fraudulent = made knowingly, or reckless as to truth
  -Negligent = only if duty of care owed to victim
• Innocent = wasn’t aware of statement being false

Question 4

What can misrepresentation not be?

Answer 4

• A mere opinion
• An expression of future intent
• A mere trade puff

Question 5

What are the types of misrepresentation?

Answer 5

• Fraudulent = made knowingly, or reckless as to truth
• Negligent = only if duty of care was owed to victim
• Innocent = wasn’t aware of statement being false

Question 6

What is fraudulent misrepresentation

Answer 6

• Made knowingly or reckless as to truth

Question 7

What is negligent misrepresentation

Answer 7

• Only if duty of care was owed to victim

Question 8

What is innocent misrepresentation

Answer 8

• Wasn’t aware of statement being false

Question 9

What remedies are available for fraudulent misrepresentation

Answer 9

• V entitled to all reparations for things lost as a result of misrepresentation

Question 10

What remedies are available for fraudulent misrepresentation?

Answer 10

• Damages under the 1967 Act and at common law
• Contributory negligence can reduce damages

Question 11

What remedies are available for innocent misrepresentation?

Answer 11

• No automatic/absolute right to damages
• Recession is possible

Question 12

What is economic duress?

Answer 12

• Threats of economic nature made to form or change an agreement
• Is a degree of coercion
• Party was deprived of free consent and agreement
• Rules created as cases arise
• Courts look at whether injured party protested
• Courts look at if there was any alternative routes or if V took steps to avoid the event

Question 13

What do courts look at in cases of economic duress?

Answer 13

• Whether the injured party protested
• Whether there was any alternative routes
• If V took reasonable steps to avoid the event

Question 14

What remedies are available for economic duress?

Answer 14

• To void contract
• Injured party must seek rescission asap after event
• Remedies for damages lie in tort