BLS 342- Exam #3 Notes

BLS 342- Exam #3 Notes - 10/25/10 BLS 342- Day 1 Notes...

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10/25/10 BLS 342- Day 1 Notes Legal Assent o Definition= Promise to buy or sell courts will require parties to obey o Without assent, contract may be avoided/ rescinded o Cancellation of contact due to lack of assent means arty with power of avoidance can require return consideration given to other party; similarly party with rescission right must return consideration received from other party o Major “obstacles” to legal assent: Mistake, misrepresentation, undue influence, duress, and unconscionability Duress o Definition= Occurs when one party threatens other with wrongful act unless assent given o Duress is not legal assent, since coercion interferes with contracting party’s free will o For courts to rescind agreement, injured party must prove duress left no reasonable alternatives to contractual agreement o Ex) Forced into contract. Godfather- “Make an offer you can’t refuse”. 1) improper threats and 2) bodily harm Situations Involving Duress o One party threatens physical harm or extortion to gain consent to contact o One party threatens to file criminal lawsuit unless consent given to terms of contract o One party threatens to file frivolous civil lawsuit unless consent given to terms of contract o One party threatens the other’s economic interests Undue Influence o Definition: Persuasive efforts of dominant party, who uses special relationship to interfere with other’s free choice of terms Ex) When an aunt is getting old but has some cash in the bank, a certain niece of nephew comes to the rescue for the money and signs a contract signing some of the money over to the niece o Any relationship involving one party’s unusual degree of trust in another can give rise to undue influence Fiduciary- bankers, lawyers, accountants to their clients. Anyone who controls his or her clients assets. Can’t violate right. Voidable contract- choice of the person who was undue influence to stay in or get out. If I tell someone that there is gold on this property to influence them to buy it, but there is no gold, they have the right to stay in or get out of the contract. Fraudulent or Negligent Misrepresentation o Fraudulent Misrepresentation= Intentional, untruthful assertion of material fact but contracting party; aggrieved party can rescind contract, and sue
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for damages o Negligent Misrepresentation= Negligent, untruthful assertion of material
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BLS 342- Exam #3 Notes - 10/25/10 BLS 342- Day 1 Notes...

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