Defenses of Enforceability

Question 1

Unilateral mistake is not grounds to avoid the contract unless?

Answer 1

1. the mistake would make enforcement of the K unconscionable OR
2. the non-mistaken party caused, or knew or had reason to know of, the mistake.

Question 2

The adversely affected party can avoid a contract on the grounds of mutual mistake if:

Answer 2

1. the mistake relates to a basic assumption of the K,
2. the mistake materially affects the agreed exchange of performance, and
3. the adversely affected party does not assume the risk of the mistake.

Question 3

A K that is assented to under duress induced by an improper threat from another contracting party is voidable if the victim:

Answer 3

1. had no reasonable alternative but to succumb to the improper threat and
2. promptly (ie, within a reas. time) disaffirmed the K.

Question 4

SOF Writing Requirement

Answer 4

Memorandum must:
1. be in writing
2. be signed by the party to be charged ( ie, any authentication that ID’s the party);
3. Contain the essential elements of the deal.

Question 5

What does the turkey hunter and gun seller problem tell us about illegal contracts and breach?

Answer 5

Illegal Ks are usually void and there is no recovery for breach.

However, a party who sub. performed and lacked an illegal purpose may recover - even if they knew of the other parties illegal purpose- unless
(1) the performing party took action to further that illegal purpose or
(2) the purpose involves grave social harm.

Here, the gun seller did not satisfy either of those categories as the turkey hunter was only buying the gun to hunt out of season, not to do grave social harm.

Question 6

An unmarried, un-emancipated minor (ie under 18 y/o) lacks capacity to enter a contract. This means that:

Answer 6

Any K the minor enters is voidable, so the minor can either:

1. void the K before or soon after turning 18 by
   a. disaffirming it through words or actions and
   b. returning any still-existing benefit received under it

OR

2. ratify the K after turning 18 by
   a. failing to timely void the K OR
   b. agreeing to be bound by it.

Question 7

What are the differences between a misunderstanding involving a material term between the parties?

Answer 7

1. If Neither party OR both of the parties to a K know or have reason to know about a misunderstanding involving a material term, NO K is formed because there is no meeting of the minds.
2. • If one party knows or has reason to know about the misunderstanding, a valid K is formed, and the unknowing party’s meaning of the term controls.

Question 8

When may a party assert the defense of unconscionability?

Answer 8

If the bargaining process and/or terms of the K were so unfair to that party when the K was made that no reasonable person would agree to it.

Question 9

When does incapacity due to intoxication render a K voidable?

Answer 9

If the intoxicated party could not reas. understand the nature or consequences of the contract AND the other party had reason to know of the intoxication.

The K can be set aside if the intoxicated party promptly disaffirms it upon becoming sober.

Question 10

When is a contract voidable for duress?

Answer 10

If either parties assent was induced by an improper threat that left the recipient with no reas. alternative but to assent.

Question 11

A K is voidable for misrepresentation if:

Answer 11

1. the misrep was fraudulent or material,
2. it induced assent to the K,
   AND
3. the adversely affected party justifiably relied on the misrep.

Question 12

Can fraudulent misrepresentation be cured?

Answer 12

Yes, it can be cured - and the K is no longer voidable by the adversely affected party - if the circumstances change in such a way that the misrep becomes true before the adversely affected party avoids the K.

Question 13

MY LEGS, Stat of Frauds Contracts

Answer 13

Marriage
Year
Land
Executor
Goods
Suretyship