Contract Law: Vitigating factors

Question 1

what are vitigating factors?

Answer 1

Something that makes a contract void or voidable
- Misinterpretation- a false statement which induces the other party to enter the contract
- Economic duress- when someone enters a contract as a result of financial threats.

Question 2

What are the elements for misinterpretation?

Answer 2

• There must be false statement as shown in Spice Girls v Aprilla World Service 2000.
• The misinterpretation must be of material fact- a statement of fact rather than opinions shown in Bisset v Wilkinson 1927
• The statement must be made by a party to the contracts as shown by Attwood v Small 1888.
• The statement induces the other party to enter the contract.

Question 3

What are the 3 types of interpretation?

Answer 3

• Innocent- false statement made honestly.
• Negligent- false statement made by a person who had no reasonable ground for believing it to be true.
• Translucent- statement made without the belief of truth.

Question 4

How is the economic duress established?

Answer 4

• Whether there was a lack of practice choice for the victim
• Whether there was legitimate pressure as commercial pressure does not amount to economic duress as shown in Pao on v Lau yiu Long 1979.

Question 5

What are remedies for innocent misinterpretation?

Answer 5

Recission equitable remedies- returning the parties to the position before the contract was made, not available for when restitution to the original pre- contract position is impossible, seen in Clarke v Dickson, when the contract is affirmed where the innocent party decides to carry on the contract, Long v Lloyds 1958, Delay of complaint after contract has seen completed as shown in Leaf v International Galleries 1950, A third party has gained rights over the property.

Question 6

What are the remedies for negligent misstatement?

Answer 6

• Recission
• Damages applied through the laws of tort

Question 7

What are remedies for fraudulent misstatement?

Answer 7

• Recission
• Damages applied through the laws of tort

Question 8

What are the remedies for economic duress?

Answer 8

Courts make an order for the restitution of property or money extracted under such duress.