MBE PQ Primer 1 Flashcards
How does a promise to surrender a claim or defense valid consideration?
A contract is generally formed when a mutual agreement is supported by valuable consideration—i.e., a bargained-for exchange of promises or performance. A promise to surrender a claim or defense can serve as consideration for a settlement agreement so long as:
-> the claim or defense is valid or subject to a good-faith dispute or
-> the surrendering party honestly believes that the claim or defense may be valid.
If the surrendering party knows that the claim or defense is invalid, an agreement to surrender it lacks consideration and is therefore unenforceable.
What are the rules regarding when an assurance can be demanded and how it can be demanded?
When a party to a contract has reasonable grounds for insecurity about the other party’s ability or willingness to perform, the insecure party can demand assurances within a reasonable time. Rumors about a party’s inability to pay are sufficient to establish reasonable grounds for insecurity—even if such rumors are false.
Under the UCC, which governs contracts for the sale of goods (e.g., paper bags), a demand for assurances must be made in writing—and a reasonable time within which to give adequate assurances is limited to 30 days. Once a proper demand for assurances is given, the insecure party may suspend performance until adequate assurances are received.
Which laws should be applied in a conflicts of law issue regarding real property?
The laws in which the real property is located.
Conflict-of-laws issues arise when significant aspects of a legal action are divided between two or more states, creating a conflict as to which state’s law applies. If the conflict involves real property, then the general rule is that the law applied by the forum court should be determined by the conflict-of-laws rule that would be applied by the courts of the situs state (i.e., the state where the property is located). The conflict-of-laws rule of the situs state typically calls for the application of its own local law (i.e., law of the situs).
What happens if there is new consideration of a lesser value given in an accord? Can the Plaintiff sue for the rest of the value?
No, unless one of the two conditions believe are not met.
Since an accord is a new contract, it must be supported by consideration. If the new consideration is worth less than what was originally agreed to, then the new consideration is sufficient only if:
-> there is a good-faith dispute as to the amount owed or
-> the new consideration is of a different type than what was owed under the original contract (e.g., goods in lieu of cash).
What must the liquidated damages in a land-sale contract be in order to be upheld by a court?
Land-sale contracts often require the buyer to make a deposit of a portion of the purchase price (sometimes referred to as “earnest money”). These contracts also typically contain a liquidated damages clause, which allows the seller to retain the buyer’s deposit if the buyer breaches the contract and refuses to purchase the property. Liquidated damages are recoverable so long as the liquidated amount bears a reasonable relation to anticipated damages. Many courts have held that a deposit of no more than 10% of the purchase price is reasonable.
What are the essential terms in a land-sale contract?
At common law, all essential terms must be covered in a contract for it to be valid and enforceable. Those terms must be sufficiently certain and definite for the court to determine the existence of a breach and give an appropriate remedy. Otherwise, the contract fails for indefiniteness.
In a land-sales contract, two essential terms are price and subject matter. Price is sufficiently certain and definite if there is a practicable method for the court to determine what the price should be (e.g., fair market value). Similarly, the subject matter is sufficiently certain and definite if it enables the court to determine exactly what property is being sold.
Can another person sign the deed apart from the grantor for it be a valid deed?
A valid deed must be in writing and contain the following elements: (1) the identity of the grantor and the grantee, (2) words of transfer, (3) a description of the property interest being transferred, and (4) the grantor’s signature. A deed signed by the principal-grantor’s agent with only the principal-grantor’s name satisfies the signature requirement so long as the agent had authority to sign on the principal-grantor’s behalf. That is because an agent may execute a deed on the principal-grantor’s behalf.
What is the damages a person can get against a defendant in an intentional misrepresentation suit?
To establish the tort of intentional misrepresentation (i.e., fraud or deceit), the plaintiff must show that:
-> the defendant knowingly or recklessly misrepresented a material fact with the intent to induce the plaintiff’s reliance and
-> the plaintiff reasonably (i.e., justifiably) relied on the misrepresentation and suffered pecuniary loss (i.e., monetary loss) as a result.
In most jurisdictions, the measure of recovery in intentional misrepresentation cases is the benefit of the bargain. That is determined by calculating the difference between the actual value received by the plaintiff in the transaction and the value that would have been received had the representation been true.*
How does negligence per se work?
A negligence action requires proof that the plaintiff’s injuries were caused by the defendant’s breach of a duty of care owed to the plaintiff. Under the doctrine of negligence per se, the plaintiff can establish that the defendant breached this duty of care by proving all of the following:
-> A law imposed a duty on the defendant.
-> The defendant violated that law.
-> The plaintiff was in the class of persons that the law was intended to protect.
-> The plaintiff suffered the type of harm that the law was intended to prevent.*
When can non attorneys fill out mortgage-loan documents?
Giving legal advice and counsel to others, as well as preparing and approving legal instruments such as deeds and mortgages for someone else, generally constitutes the practice of law.
However, the completion of standard mortgage-loan documents by nonattorney employees of a mortgage lender is not the practice of law so long as the employees are not exercising legal discretion in completing the documents. This is true even if the lender charges the borrower a reasonable fee for preparation of such documents.
What is a misrepresentation? Does statements about the future equate to misrepresentation?
A misrepresentation is an untrue assertion that is presented as a fact or an opinion. When a misrepresentation occurs, a contract is voidable and can be rescinded by the adversely affected party if:
-> the misrepresentation was fraudulent (i.e., made knowingly or recklessly with intent to induce the other party’s assent to the contract) OR material (i.e., likely to induce a reasonable person’s assent)
-> the misrepresentation induced assent to the contract and
-> the adversely affected party justifiably relied on the misrepresentation.
Statements about the future generally constitute opinions and are insufficient to support a fraudulent misrepresentation claim. However, an opinion may constitute an assertion of fact for purposes of fraudulent misrepresentation if the listener could reasonably interpret the opinion as an assertion that the speaker knows facts to support this opinion.
Under what circumstances can a fixture be removed?
A fixture is tangible personal property attached to real property in such a manner that it is treated as part of the real property when determining its ownership (e.g., the sculpture). However, absent an agreement to the contrary, a fixture that the tenant has attached to the leased property may be removed if:
-> the leased property can be and is restored to its former condition
AND
-> the removal and the restoration are made within a reasonable time.
A reasonable time for removal generally does not extend beyond the termination of the lease. However, it does so when (1) the termination was not due to a breach by the tenant and (2) the date of termination was not foreseeable by the tenant sufficiently far enough in advance to permit removal before the lease terminates
What are the requirements of an intentional infliction of emotional distress tort?
To recover for intentional infliction of emotional distress (IIED), the plaintiff must prove that the defendant—by extreme and outrageous conduct—intentionally or recklessly causes severe emotional distress to the plaintiff.
Conduct is considered extreme and outrageous if, among other things, it exceeds the possible limits of human decency so as to be entirely intolerable in a civilized society. Satire, as a traditional and widely enjoyed form of humor, is unlikely to meet this standard.
Can you retract a wavier if a party has detrimentally relied on the waiver?
No.
A contracting party may generally avoid performance if a condition precedent—i.e., an uncertain future event that must occur before performance becomes due—has not occurred. However, the nonoccurrence of a condition may be excused if the party who would benefit from the condition waives it by words or conduct. When a condition is waived before it is due to occur, the waiving party cannot retract the waiver and reinstate the condition if the other party has detrimentally relied on the waiver.
When has a seller of real property breached his duty to buyer, and could face a negligence claim from the buyer?
To prevail in a negligence action, a plaintiff must prove duty, breach, causation, and damages. A seller of real property has a duty to disclose to a buyer unreasonably dangerous natural or artificial conditions on the land if:
-> the condition exists at the time of the sale
-> the seller knows or has reason to know of the condition and its unreasonable risk to persons on the land
-> the buyer does not know or have reason to know of the condition or risk and
-> the seller has reason to believe that the buyer would not discover the condition or realize its risk.
A seller who breaches this duty is liable for physical harm caused by the unreasonably dangerous condition—at least until the buyer has had a reasonable opportunity to discover and remedy the condition.*
