BrophyContractsIIOutline----Dorff04

BrophyContractsIIOutline----Dorff04 - Justification for...

Info iconThis preview shows pages 1–3. Sign up to view the full content.

View Full Document Right Arrow Icon
Justification for Nonperformance: Mistake, Changed Circumstances, and Contractual Modifications Mistake 1. Restatement § 152 When Mistake of Both Parties Makes a Contract Voidable (1) Where a mistake of both parties at the time a contract was made as to a basic assumption on which the contract was made has a material effect on the agreed exchange of performances, the contract is voidable by the adversely affected party unless he bears the risk of the mistake under the rule stated in § 154 2. Restatement § 153 When Mistake of One Party Makes a Contract Voidable . Where a mistake of one party at the time a contract was made as to a basic assumption on which he made the contract has a material effect on the agreed exchange of performance that is adverse to him, the contract is voidable by him if he does not bear the risk of the mistake under the rule stated in § 154 and a. the effect of the mistake is such that enforcement of the contract would be unconscionable or b. the other party had reason to know of the mistake or his fault caused the mistake 3. Restatement § 154. When A Party Bears The Risk of Mistake. A party bears the risk of a mistake when a. The risk is allocated to him by agreement of the parties, or b. He is aware, at the time the contract is made that he has only limited knowledge with respect to the facts to which the mistake relates but treats his limited knowledge as sufficient, or c. The risk is allocated to him by the court on the ground that it is reasonable in the circumstances to do so. 4. Wil-Fred’s Inc. V. Sanitary District , the GC relying on the SC’s ability to make the proper bid. The SC bid not realizing that the pipes were plastic and not steel and would cost another $150k to perform the K. a. Generally, relief is refused for errors of judgment and allowed for clerical or mathematical mistakes; rather good faith and equity should prevail 1
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full Document Right Arrow Icon
b. Relief available? Reformation is only to change a zero, or a comma, or a punctuation. i. Under equity a court can rescind the contract. Maybe they void half the contract. The court could strong arm the parties by saying, I don’t see that either of you was any more unreasonable and I think we should have a settlement hearing and whoever is unreasonable should bear the risk. 5. HYPOTHETICALS a. Homer, struck by sudden inspiration, rushes out to the countryside and finds a farmer planting wheat. “How much for your fields?” he shouts. “I want to use them to grow watermelons!” The farmer explains that he has always grown wheat on these fields and has no idea whether watermelons will grow there. “I don’t care!” shouts Homer, “Just sell me your fields!” Homer pays cash on the spot and the farmer deeds him the fields. Homer rushes home to tell his family about their
Background image of page 2
Image of page 3
This is the end of the preview. Sign up to access the rest of the document.

{[ snackBarMessage ]}

Page1 / 16

BrophyContractsIIOutline----Dorff04 - Justification for...

This preview shows document pages 1 - 3. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online