Remedies for Undue Influence s 20 provides that when consent to an agreement is

Remedies for undue influence s 20 provides that when

This preview shows page 9 - 12 out of 15 pages.

Remedies for Undue Influence s. 20 provides that when consent to an agreement is caused by undue influence, the agreement is a contract voidable at the option of the party whose consent was so cause. Any such contract may be
Image of page 9
set aside either absolutely or, if the party who was entitled to avoid it has received any benefit there under, upon such terms and conditions as to the court may seem just. In setting aide the agreement absolutely, the court will restore the parties to the position they were in before the contract. The remedy is thus restitutionary. Where the party avoiding the contract has received any benefit there under, the court may set aside the contract upon such terms and conditions as to the court may seem just. The right to rescission may be lost where: (a) there is a bona fide purchaser - If a 3rd party acquires some interest in the subject matter of the contract in good faith and for value, the complainant cannot rescind the contract with the wrongdoer. (b) The complainant affirmed the transaction - for example, where A obtains a gift from B by the exercise of undue influence, B must, as soon as the undue influence has ceased, take action to rescind the gift. Fraud s.17 provides that “fraud” includes (i.e not exhaustive) any of the following acts committed by a party to a contract, or with his connivance, or by his agent , with his intent to deceive or to induce another party to enter into the contract: (a) The suggestion, as to fact, of that which is not true by one who does not believe it true (b) The active concealment of a fact by one having knowledge or belief of the fact (c) A promise made without any intention to perform it (d) Any other act fitted to deceive; and (e) Such act or omission as the law specifically declares to be fraudulent. Silence GR: Silence does not constitute fraud. Exception: unless there is a duty to speak. It is not necessary/ bound to for a party to inform another ——> fail to disclose
Image of page 10
In Derry v Peek [1889] , in order to establish fraud or fraudulent misrepresentation: (a) There must be proof of fraud (b) Fraud is proven when it is shown that the false representation has been made (i) knowingly or (ii) Without belief in its truth or (iii) Recklessly whether it is true or false (c) If fraud is proved, then the motive is immaterial. In cases of fraud by silence under s.17 , it is duty of the mislead party to exercise reasonable diligence as provided for under the exception to s.19 which provides if such consent was cause by misrepresentation or silence, fraudulent within meaning of s.17 , the contract, nevertheless is not voidable, if the party whose consent was so caused had the means of discovering the truth with ordinary diligence. Note: the duty if the misled party to exercise ordinary diligence under the exception to s.19 only applies to the situation of fraud by silence only and does not apply to all other cases of fraud. Thakkar v Gujarat Housing Board The exception of s.19 does not apply where there is a positive case of active fraudulent representation which has been responsible for bringing about the contract between the parties.
Image of page 11
Image of page 12

You've reached the end of your free preview.

Want to read all 15 pages?

What students are saying

  • Left Quote Icon

    As a current student on this bumpy collegiate pathway, I stumbled upon Course Hero, where I can find study resources for nearly all my courses, get online help from tutors 24/7, and even share my old projects, papers, and lecture notes with other students.

    Student Picture

    Kiran Temple University Fox School of Business ‘17, Course Hero Intern

  • Left Quote Icon

    I cannot even describe how much Course Hero helped me this summer. It’s truly become something I can always rely on and help me. In the end, I was not only able to survive summer classes, but I was able to thrive thanks to Course Hero.

    Student Picture

    Dana University of Pennsylvania ‘17, Course Hero Intern

  • Left Quote Icon

    The ability to access any university’s resources through Course Hero proved invaluable in my case. I was behind on Tulane coursework and actually used UCLA’s materials to help me move forward and get everything together on time.

    Student Picture

    Jill Tulane University ‘16, Course Hero Intern

Stuck? We have tutors online 24/7 who can help you get unstuck.
A+ icon
Ask Expert Tutors You can ask You can ask You can ask (will expire )
Answers in as fast as 15 minutes
A+ icon
Ask Expert Tutors