Contracts _ Defenses to Enforceability

Question 1

Age

DEFENSES

Answer 1

• A contract with a minor is VOIDABLE at option of minor

Question 2

Mental Illness:

DEFENSES

Answer 2

• Contract is VOID

Question 3

Duress

DEFENSES

Answer 3

• Wrongful threat

Question 4

Undue Influence:

DEFENSES

Answer 4

• Uneven bargaining position
  Example:
  o Jon walks up to you with a contract to sign before you take the bar exam

Question 5

Unconscionability

DEFENSES

Answer 5

• Result itself will be unfair

Question 6

Illegal

DEFENSES

Answer 6

Unenforceable … duhhhh

Question 7

Unilateral Mistake:

DEFENSES

Answer 7

• One party is mistaken
• Generally, not a defense unless:
  1) Other party knew of mistake
  2) Clerical error

Question 8

Mutual Mistake:

DEFENSES

Answer 8

• Both parties mistaken about *material term *
• Remedy: Rescission

Examples:
o Buying an animal, but neither party knew the
animal had a disease
o Joe Namath rookie card, but neither party knew it
was from the bottom of the Cracker Jack box

Question 9

Intentional Misrepresentation:

DEFENSES

Answer 9

• Knew/should have known of falsity with intent to induce reliance

Question 10

Negligent Misrepresentation

DEFENSES

Answer 10

• Causes the innocent party to detrimentally rely

Question 11

Non-Compete Clauses:

DEFENSES

Answer 11

• Reasonable under the circumstances

Tip ~ To determine if a non-compete clause is reasonable, look for facts that indicate how long you can’t compete and the geographic area restrictions

Question 12

Statute of Frauds:

STATUTE OF FRAUDS

Answer 12

Statute of Frauds:
* Certain contracts must be in writing
* Remember: MYLEGS
* Marriage
* Contract cannot be performed in one Year
* Land
* Executor
* Guarantor/Surety
* Sale of goods of $500 or more

Question 13

Part Performance Exception:
(A Showing of 2 out of 3 …)

STATUTE OF FRAUDS

Answer 13

A showing of 2 out of 3:
1) Some payment
2) Possession of land
3) Valuable Improvements

Question 14

Guarantor/Surety Exception:

STATUTE OF FRAUDS

Answer 14

1) Look to main purpose/motive
2) If self-serving, contract does NOT need to
be in writing

Example:
o Jon cosigns because he wants the car himself

Question 15

Sale of goods of $500 Exception:

STATUTE OF FRAUDS

Answer 15

1) Partial Performance will take contract out of SOF
2) Merchant Confirmation:
* Confirmation signed by sender
* Includes the quantity
* No written objection within 10 days

Question 16

Legal Writing:

STATUTE OF FRAUDS

Answer 16

1) Parties
2) Subject matter
3) Material terms
4) Signed by party to be charged