Factors excluding or tainting genuine agreement (consensus) Flashcards
Define a MISTAKE in terms of contract law?
Where one or both of the parties is mistaken about the true facts in which the contract is based
During mistake, there appears to be ____________ , but in reality there is no ___________.
consensus
What is the effect of mistake?
The contract may be void
Define a MISREPRESENTATION in terms of contract law?
Where one party makes a false statement of
fact to the other before or at the time the
contract is concluded.
During misrepresentation, There is consensus, but it was __________ obtained.
improperly
What is the effect of misrepresentation?
contract may be voidable.
What is the relationship between misrepresentation and mistake?
Misrepresentation leads to mistake.
What is the consequence of this relationship?
It becomes tricky
What is the meaning of void?
No contract
What is the meaning of voidable?
Valid but flawed
What circumstances lead to void contracts? (2)
- Mistake
- Illegality
Resulting in a Lacking contractual capacity
What circumstances lead to voidable contracts? (3)
- Misrepresentation
- Duress
- Undue influence
Resulting in a Lacking contractual capacity
What is the legal effect/consequence of a void contract? [2]
It becomes UNENFORCEABLE and results in unjustified enrichment
What is the legal effect/consequence of a voidable contract? [2]
You can either elect to:
1. Ratify - give formal consent
2. Rescind - cancel, revoke
What does ‘Restitutio in Integrum’ mean?
“restitution to the original position”.
The term is commonly used to refer to the remedy of rescission of a contract where the aim is to return the parties to the position they would have been in if the contract had never existed.
When does Restitutio in Integrum come into play?
When a voidable contract is rescinded
What are the two types of mistake? [2]
- common mistake
- unilateral mistake
What renders a contract void if it is a common mistake?
Material
What renders a contract void if it is a unilateral mistake? [2]
Material + ‘iustus error’
What is an ‘iustus error’
when the contract assertor’s reliance on the appearance of consensus is unreasonable or where there was no real reliance at all.
When is a mistake material? [2]
- General principle
- Specific precedent
What specific precedent makes a mistake material? [6]
- Error in negotio (type of contract)
- Error in corpore (subject-matter)
- Error in persona (other party)
- Error in motive
- Error in substantia (quality/characteristics)
- Error as to terms of the contract (NB!)
When is a mistake a ‘iustus’ error? [3]
- If party seeking to uphold contract knew
other party mistaken - If party seeking to uphold contract should
have known other party mistaken - If party seeking to uphold contract
induced the mistake by misrepresentation
i.e. An ‘iustus’ error is a party seeking to uphold contract ______ or should have ______ that no genuine __________ but dissensus.
knew
known
consensus
