Consent

Question 1

What is misrepresentation?

Answer 1

A false statement of fact, which induces a person to enter a contract.

Question 2

What are the required elements of misrepresentation?

Answer 2

1. A false statement of fact.
2. Made by one party to the other party of the contract.
3. Intended to induce the other party into the contract.

Question 3

What are the three types of misrepresentation?

Answer 3

1. Fraudulent.
2. Negligent.
3. Innocent.

Question 4

What is fraudulent misrepresentation?

Answer 4

The person makes a false statement ‘knowingly or without believing in its truth or recklessly’.

Remedy = Rescission + consequential damages.

Question 5

What is negligent misrepresentation?

Answer 5

The person did not know the statement was untrue but failed to take reasonable steps to find out whether it was true.

Remedy = Rescission + consequential damages.

Question 6

What is innocent misrepresentation?

Answer 6

The person making the statement believed it was true and did not make it negligently.

Remedy = Rescission only.

Question 7

What is duress?

Answer 7

Duress occurs where;

• the innocent party or their immediate family is threatened with actual or perceived violence or imprisonment; or
• a threat is made to damage the innocent party’s property; and
• the innocent party enters the contract to avoid harm.

Question 8

What is undue influence?

Answer 8

Undue influence is the improper use by an ascendant person in a relationship of trust and confidence, of their power or influence over another, for personal benefit, so that the act of the influenced party to enter a contract is not free and/or voluntary.

Question 9

What is unconscionability?

Answer 9

Unconscionability is taking advantage of a disadvantaged party which affects their ability to safeguards their own interests, and the other party is aware of the disadvantage.