same mind Flashcards
What can cause a contract to be deemed not of the same mind
Mistake, misrepresentation, undue influence and duress
What is the consequences for this
Mistake- void
misrep- voidable
duress- voidable
undue- voidable
Name and describe each type of mistakes
Common: Both parties share the same mistake
Unilateral: Only one party is mistaken
How could a common and unilateral mistake render a contract void
Common: Mistake must be material
Unilateral: Must be material and reasonable
What does it mean for a mistake to be material
Material means that the would not have contracted if they had known the true state. There can be a mistake as to the type of contract, the subject matter, terms of contract etc.
Mistake as to the attributes (such as colour) cannot render a contract void
What constitutes a reasonable mistake
It must be unilateral and the other party ought to have known the party was mistaken or the other party misled the mistaken party
What does caveat subscription refer to
It means user beware meaning the person who signs the contract is generally bound by it regardless of whether they read the whole thing.
Exemption: Spinddrifter; the clause must be made clear to the signer and adequate time must have been given to read it
What is misrepresentation
A false statement of fact made by one person to another to get them to contract. This can render a contract voidable
What are the different types of misrepresentation
fraudulent, negligent and innocent
What are the consequences of fraudulent misrepresentation
Where someone intentionally lies to get the other party to contract. The contract will be voidable and cancelled. Can claim delictual or contractual damages. Delict only for financial
What are the consequences of negligent misrepresentation
This occurs when an individual believes what they are saying but does not check the facts that a reasonable person would have. Can claim delictual damages for financial loss
What are the consequences of innocent misrepresentation
The contract will be voidable and can claim restitution
What does duress mean and what are the consequences
It means the contract has been induced to enter a contract through fear caused by violence or intimidation. Duress is not permitted under the CPA. Common law still applies but court can rule for a person to be refunded. Contract is voidable
What does undue influence mean
It is similar to duress but subtler. there is no threat of violence or intimidation but rather manipulation.
To be voidable:
- party exercised influence over the other
- this weakened parties resistance
-this was exercised in an unethical manner
-this resulted in wronged party entering into a contract that is inherently prejudicial to them and that they would not have entered into normally
