Chapter 12

Question 1

What are the two kinds of mistakes made in contract formation?

Answer 1

Mistakes of fact and Mistakes of value or quality

Question 2

What is the only kind of mistake that may allow a contract to be avoided?

Answer 2

Mistake of Fact

Question 3

Mistakes of fact occur in two forms

Answer 3

Unilateral and bilateral (mutual)

Question 4

A mistake that occurs when only one party is mistaken as to a material fact

Answer 4

Unilateral mistake

Question 5

Generally, a unilateral mistake does not give the mistaken party any right to

Answer 5

Relief from the contract

Question 6

Fraud is a

Answer 6

Tort

Question 7

The presence of fraud affects the authenticity of the innocent party’s

Answer 7

Consent to a contract

Question 8

When an innocent party is fraudulently induced to enter into a contract, the contract usually can be avoided because

Answer 8

He/she has not voluntarily consented to the terms

Question 9

3 Requirements for Fraud

Answer 9

Misrepresentation of a material fact must occur
Must be an intent to deceive
Innocent party must justifiably rely on the misrepresentation

Question 10

Knowledge by a misrepresenting party that material facts have been falsely represented or omitted with an intent to deceive

Answer 10

Scienter

Question 11

Arises from relationships in which one party can greatly influence another party, thus overcoming that party’s free will

Answer 11

Undue Influence

Question 12

The essential feature of undue influence is that the party being taken advantage of does not, in reality,

Answer 12

Exercise free will in entering into a contract

Question 13

The use of threats to force a party to enter into a contract

Answer 13

Duress

Question 14

A state statute that requires certain types of contracts to be in writing to be enforceable

Answer 14

Statute of Fraudes

Question 15

What types of contracts fall within the statute of frauds?

Answer 15

Interest in land
Contracts that cannot be performed within one year from the day after the date of formation
Collateral contract
Promises made in consideration of marriage
Contracts for the sale of goods $500+

Question 16

An agreement made before marriage that defines each partner’s ownership rights in the other partner’s property; must be in writing

Answer 16

Prenuptial Agreement

Question 17

What are the exceptions to the Statute of frauds?

Answer 17

Partial Performance
Admissions
Promissory Estoppel
Oral Contracts for customized goods

Question 18

A rule of contracts under which a court will not receive into evidence prior or contemporaneous oral statements and agreements that contradict the terms of the parties’ written contract

Answer 18

Parol Evidence Rul

Question 19

A written contract that constitutes the final expression of the parties’ agreement. Evidence extraneous to the contract that contradicts or alters the meaning of the contract in any way is inadmissible

Answer 19

Integrated Contract