BLS 342- Exam #3 Notes (TMikes)

BLS 342- Exam #3 Notes (TMikes) - Exam3NotesContinued...

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Exam 3 Notes Continued 16/11/2010 13:27:00 Legal Assent Definition – promise to buy or sell courts will require parties to obey o If assent is absolutely voluntary then the person can get out of the contract Without assent, contract may be avoided/rescinded Cancellation of contract due to lack of assent means party Duress Def. – occurs when one party threatens other with wrongful act unless assent is given o Threats of bodily harm, improper threats o If bodily harm is used the contract is void o If improper threats are used in the contract the contract is voidable Duress is not legal assent, since coercion intereferes with the contracting party’s free will For courts to rescinds agreement, injured party must prove duress left no reasonable alternatives to contractual agreement Situations involving duress o One party threatens physical harm or extortion to gain consent o One party threatens to file criminal lawsuit unless consent is given o One party threatens to file frivolous civil lawsuit unless consent is given Undue Influence Persuasive efforts of a dominant party, who uses special relationship to interfere with other’s free choice of terms o One niece or nephew looking over a rich, dying, aunt or uncle Any relationship involving one party’s unusual degree of trust in another can give rise to undue influence
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o Fiduciary is in a position of trust to their clients – control someone else’s assets o Fiduciary has upmost duty of loyalty to the person The choice to void the contract is on the person who was the subject of the undue influence Fraudulent or Negligent misrepresentation Fraudulent misrepresentation – intentional, untruthful assertion of material fact be contracting party, aggrieved party can rescind contract and sue for damages o Material fact – important facts one makes their decision on Negligent misrepresentation – negligent, untruthful assertion of material fact by contracting party; aggrieved party can rescind contract, and sue for damages o Contrast with “innocent misrepresentation” when party making false assertion believes it to be true, and is not negligent in making false assertion; although innocent misrepresentation permits misled party to rescind contract, he/she cannot sue for damages o Fraud in the execution – ( to do) – fraud in the effective moment in the contract Accidentally signing a document; considered void Courts permit contract rescission for fraudulent or negligent misrepresentation, assuming: o False assertion, intent to deceive, justifiable reliance on false assertion by innocent party Mistake Def. – erroneous belief regarding material facts of contract at time agreement made Unilateral mistake – mistake made by one contracting party; generally, contract still binding o If party knew or should’ve known there was a mistake of fact then the contract is void Mutual (bilateral) mistake – mistake made by both parties; if mutual mistake of material
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BLS 342- Exam #3 Notes (TMikes) - Exam3NotesContinued...

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