Requirement that No Defenses Exist Flashcards
The following persons have legal incapacity to contract:
- Minors;
- Mentally incapacitated persons;
- Intoxicated persons.
Elements of undue influence are…
(1) undue susceptibility to pressure by one party, and
(2) excessive pressure by the other party.
Contracts induced by duress or undue influence are…
voidable and may be rescinded as long as they are not affirmed.
If a contract incudes a term with at least two possible meanings and neither party is aware of the ambiguity…
there is no contract, unless the parties intended the same meaning.
If a contract incudes a term with at least two possible meanings and both parties are aware of the ambiguity…
there is no contract unless both parties intended the same meaning.
If a contract includes a term with at least two possible meanings and only one party knew (or should have known) of the ambiguity…
there is a binding contract based on what the ignorant party reasonably believed to be the meaning of the ambiguous words.
If both parties entering into a contract are mistaken about existing facts relating to the agreement, the contract may be voidable by the adversely affected party if:
(1) The mistake concerns a basic assumption on which the contract is made;
(2) The mistake has a material effect on the agreed-upon exchange; AND
(3) The party seeking avoidance did not assume the risk of the mistake.
(look for the existence of the subject matter – not the value)
If only one party is mistaken about the facts relating to the agreement (unilateral mistake), the mistake will not prevent formation of a contract, unless…
the nonmistaken party knew or had reason to know of the mistake.
Unconscionability is a defense to contract formation which occurs when…
there is an unfair surprise and oppressive terms in the bargaining process.
In Virginia, unconscionability applies only to the formation of contracts, where as the obligation of…
good faith applies only to the performance or enforcement of contracts.
The statute of frauds applies to contracts involving…
- Marriage (M)
- Contracts to be performed within 1 year (Y)
- Land Contracts (L)
- Executor or administrator contracts (E)
- Goods for $500 or more (G)
- Surety Contracts (S)
Executor or administrator contracts are contracts to…
pay an estate’s debts out of their own funds.
Suretyship promises are…
promises to answer for the debt or default of another.
(does NOT apply if the main purpose of the contract is to serve a pecuniary interest of the promisor)
Contracts for the sale of goods for $500 or more do NOT fall under the statute of frauds if:
- The goods are specially made (S);
- There is a written confirmation by a merchant (W);
- Admission in court/testimony (A);
- Performance has already occurred (paid made & accepted or received & accepted) (P).
In Virginia, a contract to devise real property or leave all one’s property by will to another in exchange for services (is/is not) within the Statute of Frauds.
IS
In Virginia, if one wants to enforce an oral contract to devise real property or leave all one’s property to another in exhange for goods, the oral devise will be enforceable only if:
(1) The agreement is certain & definite in its terms;
(2) The acts done in part performance were done pursuant to the agreement; and
(3) The contract was so far executed that a refusal to enforce would operate as fraud upon the party rendering services.
Are lifetime contracts subject to the SoF?
No – they COULD be completed within a year.
A promise creating an interest in land must be evidenced by writing. This includes agreements for the sale of real property as well as:
- Leases for 1+ year;
- Easements for 1+ year;
- Mortgages & security liens;
- Fixtures;
- Minerals or structures if they are to be severed by the buyer.
Construction contracts (do/do not) generally fall within the statute of frauds.
do not
Noncompliance with the Statute of Frauds renders the contract…
unenforceable at the option of the party to be charged.
The common law rule is that even if a written contract expressly provides that it may by modified only by a writing, the parties…
can orally modify the contract.
Under the UCC, if a contract explicitly provides that it may not be modified or rescinded except by a signed writing, that provision is…
given effect.
However – if the contract is between a merchant and nonmerchant, the provision requires the nonmerchant’s separate signature.
If a seller conveys property to the buyer (full performance), the seller (can/can not) enforce the buyer’s oral promise to pay.
Can
If a buyer seeks to enforce an oral land sale contract, under the doctrine of part performance, the buyer must have:
2/3 of the following:
1. Possession;
2. Payment (in whole or part); or
3. Valuable improvements.
