Chapter 9

Question 1

Impeachment

Answer 1

grounds in which a contract may be set aside

Question 2

Recission

Answer 2

• the setting aside of a contract due to a defect in its formation such as a mistake, misrepresentation, duress or undue influence
• the discharge of the contract by the subsequent agreement of the parties
• defect must be there before formation

Question 3

Object of recission

Answer 3

• to place parties as closely as possible back to their pre-contractual positions
• not compensation/damages

Question 4

Mistake in terms

Answer 4

Mistake when reducing the terms to writing

typographical errors
-reasonable bystander test

Ambiguity - multiple interpretations of the same term

Question 5

Mistake in assumptions

Answer 5

• refers to the subject matter of the contract

- mistake in the assumption as to the existence of the subject matter - K is void

Question 6

Mistake in Identity

Answer 6

• often occurs in fraud situations

- person you engaged in contract with is lying about who they are

Question 7

Mistake and innocent 3rd parties

Answer 7

-often occurs in fraud situations

A sells to F
F sells to B
F takes the \$\$ and moves to S. America
A discovers mistake
Who suffers the loss?

• If K is deemed void, then there was no K and therefore goods or money must be returned to A
• If K is deemed voidable, then there was a K and therefore goods or money stays with B

The innocent 3rd party must be that – innocent–
Must be a BFPVWN: Bona Fide Purchaser for Value Without Notice

Question 8

Non Est Factum

Answer 8

Another type of mistake = “not my deed”

Claim of non est factum = this is not the contract i agreed to

reliance on another person’s word that the document contains the right terms agreed to

• works for blind and illiterate
• does not work for careless mistakes

Question 9

Misrepresentation

Answer 9

a statement/representation made during negotiation of a contract, before formation of the contract, that turns out to be false

-can be innocent (R), negligent (R or S), fraudulent (R and S)

Elements:

1) Statement/Representation made
2) Statement is False
3) Intent (if fraudulent); Duty of Care owed/Standard breached (if negligent)
4) Reliance on the statement caused the injured party to enter the contract
5) Caused Harm

Question 10

Omissions

Answer 10

• if you say nothing

- not a statement so it does not count

Question 11

Undue Influence

Answer 11

domination of one party over the mind of another to such a degree that makes them unable to make a independent decision

-K under undue influence would be voidable at the choice of the victim

Question 12

Special relationships

Answer 12

undue influence often arrises in situations where both parties have a special relationship with each other

ex. Husband and wife
- Need for ILA: Independent Legal Advice (separate from spouse)

Question 13

Duress

Answer 13

actual or threatened violence or imprisonment as a means of coercing a party to enter a contract

Coercing: improperly forced payment