Chapter 12 (Exam 3)

Question 1

Concept that there is a defense to a contract unless the parties consent is both REAL and VOLUNTARY

Answer 1

Reality of consent

Question 2

5 situations where there is a lack of reality of consent

Answer 2

Mutual mistake of material fact
Material misrepresentation 
Duress
Undue influence
Unconscionability

Question 3

Court order cancellation of contract

Answer 3

Rescission

Question 4

Court ordered revision of a contract to correct a mistake

Answer 4

Reformation

Question 5

Mistake of fact by both parties to the contract

Answer 5

Mutual mistake

Question 6

Mistake by only one party to the contract

Answer 6

Unilateral mistake

Question 7

3 requirements for proving mutual mistake

Answer 7

1. Must be more than mere uncertainty
2. Must be material
3. Fact that can be proved in past or present

Question 8

What does the word material mean?

Answer 8

Importsnt to the subject matter at hand

Question 9

In order for a mistake to be an issue of fact, the mistake must pertain to (3) things

Answer 9

Existence
Identify
Character of the subject matter

Question 10

Remedy for mutual mistake of material fact is

Answer 10

Rescission

Question 11

Is rescission normally a remedy for unilateral mistake ?

Answer 11

No. maybe be allowed though

Question 12

Elements to prove for unilateral mistake

Answer 12

1. Mistake of fact by one party to contract
2. non-mistaken was aware of other party’s mistake of fact
   3Mistake was regarding a verifiable fact (past or present)

Question 13

3 types of material misrepresentation

Answer 13

Innocent
Negligent
Fraudulent

Question 14

Remedy for innocent misrepresentation

Answer 14

Only rescission

Question 15

Misrepresentation without fault

Answer 15

Innocent mis.

Question 16

Misrepresentation that occurs when a party makes a statement without exercising due care to ensure that the statement is true

Answer 16

Negligent mis.

Question 17

Remedies for negligent misrepresentation

Answer 17

Suing for damages or rescission

Question 18

Misrepresentation where there is a false statement of fact made with the intent to deceive, reasonably relied on , and causes damages

Answer 18

Fraudulent misrepresentation

Question 19

Remedies for fraudulent misrepresentation

Answer 19

Rescission or actual damages + punitive damages

Question 20

2 types of fraudulent misrepresentation

Answer 20

Fraud in the execution

Fraud in the inducement

Question 21

Lying about the nature of a document in order to obtain a person’s signature

Told signing a loan but really it’s a promissory note

Answer 21

Fraud in the execution.

Question 22

Misrepresentation as to the understood subject matter of the contract

Seller lies to victim about the object being purchased

Answer 22

Fraud in the inducement

Question 23

4 elements that must be proved for fraud in the inducement

Answer 23

1. Misrepresentation of material fact
2. Intent to deceive : knew or disregard to truth
3. Reasonable reliance
4. Caused damage

Question 24

Are opinions, statements of law or value, prediction, and general statements usually statements of fact ?

Answer 24

No

Question 25

When do opinions, statements of law/value, and predictions count ?

Answer 25

1. Confidential relationship between parties 2. Seller has superior knowledge 3. Concealment - buyer has no reasonable way of discovering defect

Question 26

Forcing s party into a contract through fear of wrongful threats

Answer 26

Duress

Question 27

4 elements to prove duress

Answer 27

1. Defendant must have threatened plaintiff 2. Threat must be wrong and unlawful 3. Involuntary acceptance 4 no alternative

Question 28

Is duress a threat if economic handmade or only physical harm ?

Answer 28

Both

Question 29

Abuse of position of trust to take advantage of a person who lacks freedom of will , without coercion

Answer 29

Undue influence

Question 30

3 elements for undue influence

Answer 30

1. Confidential, fam, or trust relation between parties 2. Weaker party lacks free will because of influence of stronger part 3. Contract or gift is between 2 parties

Question 31

Theory of ______ is often used to contest a death bed will or deed

Answer 31

Undue influence

Question 32

Defense which allows a person to avoid a contract if he was pressured into accepting the terms of the contract and its grossly unfair

Answer 32

Unconscionability

Question 33

3 elements to prove unconscionability

Answer 33

1. Unequal bargaining power 2. Contract of adhesion 3. Contract is obvisouly unfair or oppressive

Question 34

Contract in which the terms are dictated by the stronger party with no real negotiation allowed

Answer 34

Contract of adhesion

Question 35

The fact that the object is worth more or less than what we thought is a mistake of

Answer 35

Value

Question 36

In extreme cases when something is worth more or less, it's a mistake of

Answer 36

Character

Question 37

End result of fraud in execution is that the contrsct is ______

Answer 37

Void

Question 38

2 ways to prove intent to deceive by defendant

Answer 38

1 defendant had knowledge of falsity of stats ent | 2. Defendant had reckless regard for truth

Question 39

T or F. Threatening to sue someone under the promissory note if they owe you money is considered duress

Answer 39

False, threatening what one has legal right to do is not duress

Question 40

Duress involves

Answer 40

Coercion

Question 41

Old Rule: __________ : a contract is a co tract

Answer 41

Buyer Beudre

Question 42

For remedies usually a party must choose between

Answer 42

Dollar damages and equitable remedy

Question 43

Reformation is used if (2 reasons)

Answer 43

1. Oral agreement of parties | 2. Mistake in writing

Question 44

Mistake in writing

Answer 44

Scrivener's error

Question 45

Is uncertainty enough in mutual mistake of fact ?

Answer 45

No

Question 46

Is unilateral mistake grounds for recission?

Answer 46

No