K2 BLACK LETTER LAW CUMULATIVE S06

K2 BLACK LETTER LAW CUMULATIVE S06 - Contracts II Black...

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Contracts II – Black Letter Law - Daicoff - p. 1 CONTRACTS II – DAICOFF – BLACK LETTER LAW OUTLINE (78 Pages) Week 1.1 DURESS & ECONOMIC DURESS: I. Rest. 2d Section 174: Duress by Actual Physical Compulsion/ K Void A. Duress by actual physical compulsion to enter into the K, exerted by a party to the K or by a third party (not a party to the K) on the victim who enters the K as a result of the duress (i.e., causal connection), makes the K void (this includes taking the victim’s hand and forcing him to sign his name, or forcing her to sign at gunpoint). B. Void means: (1) K is not enforceable by any one; (2) K cannot be ratified by the victim; and (3) K is not enforceable even by an innocent party to the K, or a subsequent assignee of the K, even if she is unaware and has no reason to know of the duress and even if she relies on the K to her detriment or gives value for the K. C. Old Rule: only actual imprisonment or fear of loss of life or limb qualified; threats did not. Current rule is duress is “any wrongful act or threat that overcomes the free will of the contracting party.” Bond (Minority) Rule : Extends this type of duress to encompass threats of death, serious, imminent physical harm, or unlawful imprisonment. II. Rest. 2d Section 175: Duress by Improper Threat/K Voidable A. Duress consisting of improper threats (defined below) made by a party to the K to the victim who enters the K as a result of the duress (i.e., causal connection), makes the K voidable. --The Restatement also requires that the victim have “no reasonable alternative” but to enter the K. B. Voidable means: (1) K is not enforceable by the threatening party to the K, even if he gave value for or relied materially on the K; (2) K can be ratified or affirmed by the victim once the duress stops; (3) K is enforceable against the victim by an innocent party who is a party to the K or a subsequent assignee of the K, either of whom is unaware (and has no reason to know) of the duress and either relies on the K to his detriment or gives value for the K (the Restatement says “relies materially on the transaction or gives value.”) C. Improper threats -- Examples of what qualifies as duress (Rest. 2d Section 176 definitions): -can be express or implied --can’t be simply hard bargaining (refusing to sign a K unless you agree to my terms) --Restatement requires that the resulting K is to be unfair and more: see Section 176(2)(a- c) for more elements. 1. a) Violence or threats of violence, including battery b) Threat to commit crime or tort that will injure the person, family, or property of the victim, including destroying one’s property, goods, or house c) Imprisonment or threats of imprisonment
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Contracts II – Black Letter Law - Daicoff - p. 2 d) Wrongful seizing or w/holding goods or lands or threats to do so - here you need an additional element = that the victim had no reasonable alternative but to agree. 2.
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K2 BLACK LETTER LAW CUMULATIVE S06 - Contracts II Black...

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