Chapter 11 Flashcards
What is the definition of Duress
Unlawful or wrongful act that overcomes the free will of a party
What are the three elements of a contract
Offer, acceptance, consideration (first two are called the meeting of the minds)
What does void mean for contracts
when a contract for reasons is no longer valid
What does it mean for a contract to be voidable
When a party in a contract can choose to terminate said contract
What are the two types of duress
Physical compulsion and Improper Threats
What is physical compulsion
Coercion involving physical force renders the agreement void
What are improper threats
Threats or acts including economic or social coercion to compel someone into entering a contract
What is undue influence
Taking an unfair advantage of a person by reason of a dominant position of a confidential relationship. Renders a contract voidable and dominant party liable in restitution (Doctor Patient)
What is fraud in the execution
A misrepresentation that deceives the other party as to the nature of a document evidencing the contract. Renders the agreement void
Fraud in the Inducement
Renders the agreement voidable if the party can prove 1) Materiality of substantial importance 2) Knowledge of falsity and intention to deceive
What are the elements of fraud in the inducement
1) False Representation
2) Of a fact
3) That is material
4) Made with knowledge of its falsity and intention to deceive
5) Which representation is justifiably relied upon
6) Damages
What is negligent misrepresentation
Made without due care in ascertaining truthfulness
What is innocent misrepresentation
A false representation made without knowledge of its falsity with due care
What is a mistake
Understanding that is not accord with existing fact
What is a mutual mistake
Both parties have a common but erroneous belief forming the contract. Renders the contract void by the adversely affected party.
