Defenses

Question 1

i.music; list (6)

What are the defenses

Answer 1

1. Incapacity
2. Mutual assent, absence of ^{(aka lack of offer + acceptance)}
3. Unconscionability
4. SOF
5. Illegality
6. Consideration, absence of

Question 2

voidable vs void

Answer 2

When a contract is voidable, a party to the contract is able to cancel or revoke the contract

A contract may be deemed void if the agreement is not enforceable as it was originally written

Question 3

list (4)

What are the incapacity defenses

Answer 3

1. Voluntary Intoxication
2. Involuntary intoxication
3. Mental incapacity
4. Infancy/minority

Question 4

incapacity defense

When is voluntary intoxication a defense

Answer 4

K is voidable (aka not enforceable) if other party had reason to know of intoxication

Question 5

incapacity defense

When is voluntary intoxication not a defense

Answer 5

If there was “no reason to know” of intoxication then the K is NOT voidable aka the K is enforceable

Question 6

incapacity defense

When is involuntary intoxication a defense

Answer 6

K voidable if person could not understand nature or significance of agreement when entered;

treated like mental incapacity

Question 7

incapacity defense

When is mental incapacity a defense

Answer 7

Person so mentally deficient they cannot understand nature or significance of agreement when they entered it

Question 8

incapacity defense, list (2)

Mental incapacity can void a K when:

Answer 8

1. A previously incapacitated person can void/disaffirm a K when lucid or
2. Void a K through use of a legal represenative

Question 9

incapacity defense

When is infancy/minority a defense

Answer 9

when minor makes a K, minor can void the K

Question 10

incapacity defense; list (2)

When can a minor affirm or void a K

Answer 10

1. By conduct
2. Before turning 18 or ~6mo after turning 18

Question 11

AMA; list (3)

Types of “absence of mutual assent”

Answer 11

1. Misunderstanding
2. Misrepresentation
3. Mistake
   
   1. unilateral mistake
   2. mutual mistake

Question 12

AMA

When is misunderstanding a defense

Answer 12

If K includes a term with at least two possible meanings

Question 13

AMA; list (3) - misunderstanding

If K language is ambiguous, K formed/not formed depending on awareness.

What are the levels of awareness and is K formed?

Answer 13

1. Neither party aware - NO K unless both parties intended same meaning
2. Both parties aware - NO K unless both parties intended same meaning
3. One party aware - binding on what ignorant party reasonably believed to be the meaning of the ambiguous words

Question 14

AMA; list (3)

Mutual mistake makes a K void if:

remember - void means unenforceable from the start

Answer 14

1. mistake concerns a basic assumption on which K is made
2. mistake has a material effect -AND-
3. party seeking avoidance did not assume risk of mistake

Question 15

AMA

Unilateral mistake is voidable** when

remember - voidable means one or both parties can avoid

Answer 15

Nonmistaken party knew or had reason to know about mistake, then mistaken party (party who did not know of the mistake and acted upon K) can void

iow: the unilateral mistake will not prevent formation of the contract _unless_ the nonmistaken party knew or had reason to know of the mistake

Question 16

AMA

Unilateral mistake is NOT voidable when

(aka K is enforceable/can have a case for breach of K)

Answer 16

when nonmistaken party DID NOT have reason to know of the mistake

which means that the mistaken party will be liable on the K and cannot void it

Question 17

AMA; list (2)

Types of misrepresentation

Answer 17

1. fraudulent misrepresentation
2. material misrepresentation

Question 18

fraudulent misrepresentation - what happens to K?

Answer 18

K is voidable by innocent party if the justifiably relied on the fraud

Question 19

material misrepresentation

Answer 19

K is voidable by innocent party if the justifiably relied on misrepresentation AND misrep was material

Question 20

list (2)

A misrepresentation is material if

Answer 20

1. induces a reasonable person to agree -OR-
2. maker knows that a particular person would agree (because of some special circumstance) even if a reasonable person would not

Question 21

SOF

Answer 21

Certain agreements (MYLEGS) - by statute - need to be in writing AND signed to be enforceable

Question 22

who needs to have signed the K under SOF

Answer 22

party being sued

Question 23

MYLEGS

Answer 23

M - marriage

Y - performance that cannot be performed in one year

L - interest in land

E - Executor (or administrator)

G - Goods over $500

S - surety

Question 24

Marriage

Answer 24

a promise where the consideration given is marriage

Question 25

Year

Answer 25

a promise that cannot be completed within one year

Question 26

when does time period start for “Year” Ks

Answer 26

date of agreement **NOT** date of performance

Question 27

# list (5) Land

Answer 27

promise creating an interest in land, which includes 1. leases from more than one year 2. easements for more than one year 3. mortgages and most other security liens 4. fixtures 5. minerals or structures if they are severed by buyer

Question 28

Equal Dignity Rule

Answer 28

Granting authority to a 3^rd party to enter into a K on behalf of someone else only needs to be in writing **IF** the subject of the K falls under SOF ## Footnote *^{ex: Billy alleges Nas orally agreed to seel Ranch for $4m. Nas authorizes an agent to sell the ranch. Must authorization be in writing?} **^YES **^{b/c underlying subject is the sale of land which is an SOF issue}*

Question 29

# ist (2) what does **NOT** create interest in land

Answer 29

1. Ks to build 2. Ks to find a buyer for a seller

Question 30

Executor

Answer 30

promise by executor or administrator to pay estate's debts from **their own funds**

Question 31

Goods

Answer 31

K for sale of goods $500 or more

Question 32

Signature for Goods - what to consider

Answer 32

1. who has signed? is it party being sued? 2. if not, is it a merchant's confirmatory memo? *(merchant sends signed writing to another merchant to memorialize their oral agreement → other merchant can deny within certain time frame otherwise, writing becomes enforceable)* 3. If neither of the above, the writing **NOT** enforceable

Question 33

# SWAP; list (4) Goods $500 and over that can be enforced without a signed writing

Answer 33

1. **Specially** made goods 2. **Written** confirmation by a merchant to an oral agreement - *merchant's confirmatory memo* 3. **Admission** in court 4. **Performance**

Question 34

Surety

Answer 34

a promise to relieve the debts of another **IF** offered as collateral to that person's promise to pay. ## Footnote *Example* * collateral promise- give him the goods, if he does not pay, I will;* * **signed writing needed*** *primary promise - give him the goods and i will pay;* ***no signed writing needed***

Question 35

Key phrase for suretyship to apply

Answer 35

“If he doesnt pay, I will pay”

Question 36

Main purpose doctrine | (as it applies to surety)

Answer 36

main purpose to **relieve** **debt** - ***writing is needed*** main purpose **guarantee** **completion** of an agreement - ***writing is not necessary***

Question 37

if the writing does meet SOF requirements, then

Answer 37

the party being **sued** can raise it as a defense for lack of a sufficient writing thus rendering the K **unenforceable**

Question 38

if a **written K** is modified **orally** and the contract as modified falls within SOF, then

Answer 38

the modified K must be in **writing** to be enforceable

Question 39

Under CL, what happens if there is **oral** modification if a written K **expressly** provides that it can ***only*** be modified by a writing

Answer 39

oral modification will be **_enforceable_!**

Question 40

Under UCC, what happens if there is a provision that says K may only be modified or rescinded by a signed writing? if it is btwn a merchant and a nonmerchant?

Answer 40

the provision is respected and signed writing will be **_required_** separate signature of nonmerchant will be required

Question 41

what happens if parties try to **orally modify** a K that requires **written** modification?

Answer 41

will be **ineffective** as ***modification*** but can be considered a **waiver**