Defenses

Question 1

mutual mistake

Answer 1

contract may be voidable if

1. mistake concerns a basic assumption on which the k is made
2. the mistake has a material effect on the agreed upon exchange

Question 2

Assumption of risk

Answer 2

not a defense if party assumed risk that assumption was mistaken. this occurs where one party it in a better position to know risks than other parters

Question 3

Value

Answer 3

generally mistake in value not a defense both assume risk as to value is wrong

Question 4

Unilateral mistake

Answer 4

not a defense however if the nonmistaken party knew or had reason to know of the mistake made by the other party, the k is voidable by the mistaken party. eg. subcontrators bid.

Question 5

Mistake by intermediary

Answer 5

mistake in transmission of offer or acceptance the message as transmitted is operative unless the other party knew or should have known mistake

Question 6

Misunderstanding of ammbiguous k language

Answer 6

One party aware - binding k based on what the ignorant party reasonably believed to be the meaning of ambiguous words.

Question 7

Misrepresentation

Answer 7

k is voidable if one party induces another to enter into a k by using fraudulent misrep. K is voidable by innocent p if she justifiably relied on the fraudulent statement

Question 8

Material misrepresentation

Answer 8

justifiably rely and material. material if

1) induce a reasonable person to agree
2) the maker knows that for some special reason it is likely to induce the person to agree, even if reasonable person would not

Question 9

Failure to read a k

Answer 9

does nor preclude a misrepresentation k

Question 10

rescind

Answer 10

innocent party may take affirmative action to rescind agreement for misrepresentation

Question 11

Absent of consideration

Answer 11

promise was illusory

Question 12

public policy defense illegality

Answer 12

k is void if subject matter is illegal except

1. p is unaware of illegal
2. one party is not as culpable as the other
3. failure to obtain a license for revenue raising purposes

Question 13

What if purpose is illegal?

Answer 13

k is voidable by a party who was unaware of the purpose or aware but did not facilitate the purpose and the purpose does not involve serious moral turpitude.

Question 14

Legal incapacity to contract

Answer 14

infants - however binding when infant becomes an adult unless they disaffirm the k in whole before 18 or right after 18 and must return any benefit she received.

Question 15

Mental incapacity

Answer 15

one whose mental incapacity is so deficient that he is incapable of understanding the nature and significance of a k may disaffirm when lucid or by a later appointed rep. voidable

Question 16

Intoxicated person

Answer 16

one who is intoxicated that he does not understand the nature and significance of his promise may be held to have made a voidable promise if the other party had reason to know of his intoxication. quasi k for necessaries.

Question 17

Duress and undue influence

Answer 17

withholding something someone needs will constitute economic duress if

1. the party threatens to commit a wrongful act that would seriously threaten the other contracting party’s property or finances; and
2. there are no adequate means available to prevent the threatened loss.

Question 18

Elements of undue influence

Answer 18

1 undue susceptibility to pressure by one party and
2 excessive pressure by the other party
occurs when dominant party is a confidential or caregiver relationship with the influenced party.

Question 19

Statute of Frauds

Answer 19

certain agreements by statute must be evidenced by a writing signed by the party sought to be bound.

Question 20

SOF writing requirement

Answer 20

does not require a formal k. it requires one or more writings that: (i) reasonably identify the subject matter of the k, ii) indicate that a k has been made and iii) state with reasonable certainty the essential terms.

Question 21

Electronic record

Answer 21

satisfies writing req.

Question 22

essential terms

Answer 22

identity of parties, description of the subject matter, and the terms necessary to make the contract definite.

Question 23

Writings in land sale ks

Answer 23

must contain description of the land and price

Question 24

employment ks

Answer 24

length of employment

Question 25

UCC

Answer 25

some signed writing indicating a k has been made and specifying the quantity term.

Question 26

Signature requirement

Answer 26

any mark or symbol with intention to authenticate writings. Under UCC, a party’s initials or letterhead may also be sufficient. Signed only by the party to be charged. see exception with merchants confirmatory memo

Question 27

exception merchant’s confirmatory memo

Answer 27

In k’s between merchants, if one party within a reasonable time after an oral agreement has been made sends to the other party a written confirmation of the understanding that is sufficient under the SOF to bind the sender, it will also bind the recipient if i) he has reason to know of the confirmation’s contents and ii) he does not object to it in writing within 10 days.

Question 28

Agreements covered under SOF

Answer 28

MY LEGS
Marriage
More than one Year
Land
executor
Goods of more than 500
Suretyship

Question 29

Executor or Administrator Promises

Answer 29

A promise by an executor or administrator to pay the estate’s debts out of his own funds must be evidenced by a writing.

Question 30

Suretyship promises (promise to pay a debt of another)

Answer 30

A promise to answer for the debt or default of another must be evidenced by a writing.

Question 31

Promises in consideration of marraige

Answer 31

this applies to promises that induce marriage by offering something of value other than a return promise to marry eg. pre-nups.

Question 32

Interest in land

Answer 32

not only agreements for real property but also

1. leases for more than one year
2. easements of more than one year
3. mortgages and most other security liens
4. Fixtures
5. Minerals or structures if they are to be severed by the buyer.

Question 33

Performance not within one year from date of k

Answer 33

a promise by its terms cannot be performed within one year is subject to the SOF. date runs from the date of the agreement and not from the date of performance.

Question 34

employ until i die and work until I die

Answer 34

not within SOF person can die at anytime

Question 35

Goods

Answer 35

a writing is sufficient even if it omits or incorrectly states a term but the k is not enforceable beyond the quantity of goods shown in the writing.

Question 36

K in goods is enforceable without writing in 4 scenarios

Answer 36

1 specially manufactured goods - made a substantial beginning of performance or commitments for goods not in ordinary course.
2 admissions in pleadings or court
3 payment or delivery of goods.
4. Merchants confirmatory memo - HAVE TO BE BOTH MERCHANTS

Question 37

Noncomplieance with Statute

Answer 37

k is unenforceable at the option of the party to be charged if statute is not raised as a defense, it is waived.

Question 38

Land sale ks not in SOF

Answer 38

if the seller conveys to the buyer, he can enforce the buyer’s oral promise to pay. Likewise, the buyer may seek to specifically enforce an oral land sale k under the doctrine of part performance - payment in whole or part, possession, or valuable improvements

Question 39

Sale of good ks not in the SOF

Answer 39

Part performance takes sale of goods contract out of SOF when: i) the goods have been specially manufactured or ii) the goods have been either paid for or accepted.

Question 40

Service ks not in SOF

Answer 40

an oral k that cannot be completed within one year but has bee fully performed by one party is enforceable - no SOF defense

Question 41

Estoppel

Answer 41

estoppel may be applied if it would be inequitable to allow the Statute to defeat a meritorious claim

Question 42

Remedies if K is within Statute

Answer 42

if a k violates the SOF, in almost all cases a party can sue for the reasonable value of the services or part performance rendered, or the restitution of any other benefit that has been conferred.

Question 43

Unconscionability

Answer 43

allows a court to refuse to enforce a provision or an entire contract (or to modify the k) to avoid unfair terms, usually due to some unfairness in the bargaining process. Unfair price alone is not enough. It is determined at the time the k Was formed.

Question 44

common instances of procedural unconscionability

Answer 44

1. inconspicuous risk shifting provisions - boilerplate
2. Take it or leave it adhesion ks
3. exculpatory clause
4. Limitation on Remedies