purpose is legal and not against public policy. • usury / gambling / licensing (revenue vs. protection) / restraint on trade (ex: non-compete) / unconscionable / exculpatory clause that protects intentional misconduct / crime • may not be void if: justifiable ignorance of facts / members of protected class / withdraw from an illegal agreement / severable / fraud / duress / undue influence Characteristics / Enforceability • Valid: all four elements exist (CALC). enforceable when no legal defenses. unenforceable or voidable if legal defense: 1) Voluntary Consent (agreement but ….. no assent so voidable) • Unilateral Mistake: material fact (value) by one party / voidable only if other party knew/should have known of mistake or inadvertent substantial mathematical error • Bilateral Mistake: voidable by either party / same mistake of material fact (value) • Fraudulent Misrepresentation: voidable / misrep of material fact, intent to deceive, and justifiable reliance / puffery, silence unless latent defect, and misrep of law not actionable • Undue Influence: voidable / special relationship overcomes free will • Duress: voidable / force into contract by wrongful or illegal threat • Adhesion Contract/Unconscionable: voidable / one sided, standard form, uneven bargaining power 2) Form (not in writing when required … so unenforceable) • Void: no contract / contract lacking a CALC element • Quasi Contract: no contract / ct creates contract as equitable remedy “as if” there was one to prevent unjust enrichment • Voidable: a party has an option of avoiding or enforcing the contract (capacity, voluntary consent) • Interpretation: four corners unless ambiguity then interpret against the drafter and consider extrinsic evidence (express terms / course of performance / course of dealing / custom and usage) • Description: bilateral (promise for promise) vs. unilateral (promise for an act) / formal (negotiable instrument) vs. informal / express (words) vs. implied (act) / executed (fully performed) vs. executory (incomplete) • Claim Settlement: accord and satisfaction / release / covenant not to sue
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- Fall '15