legal studies 3

What is legal assent?

The expression of agreement. Without it, a contract may be unenforceable.

What are the four major obstacles to legal assent?

Mistake, misrepresentation, undue influence, and duress.

What is a mistake of fact?

means one or both people signed an agreement based on a wrong idea about a real, important truth at the very moment they made the deal.

What is a unilateral mistake?

A mistake made by one contracting party.

In a unilateral mistake, is the contract still binding?

 unless the other person knew about the error, it was an honest typo, or the deal is so wildly unfair it would be outrageous to enforce.

What is a mutual (bilateral) mistake?

A mistake made by both parties. Either party may rescind the contract.

What is innocent misrepresentation?

A false statement about a material fact that the person making it genuinely believed to be true.

Consequence of innocent misrepresentaion

The misled party can rescind the contract but cannot sue for damages.

What is negligent misrepresentation?

An unintentional, untruthful assertion of a material fact that the party knew or should have known to be false.

Consequence for negligent misrepresentation

The aggrieved party can rescind the contract and sue for damages (if they justifiably relied on the assertion).

What is fraudulent misrepresentation?

An intentional, untruthful assertion of a material fact made with the intent to deceive.

Consequences for fraudulent misrepresentation?

The misled party can rescind the contract and sue for damages (if they justifiably relied on the assertion).

What is undue influence?

When a dominant party uses a special relationship (involving an unusual degree of trust) to interfere with another person's free choice of contract terms.

What factors do courts consider to determine undue influence?

• Was the other party rushed to consent?

• Did the dominant party gain undue enrichment?

• Was the nondominant party isolated from other advisers?

• Is the contract unreasonably one-sided?

What is duress?

When one party is forced into an agreement by a wrongful act, leaving no reasonable alternative. (Coercion destroys free will, so it is not legal assent).

What are four common examples of duress?

• Threat of physical harm or extortion.

• Threat to file a criminal lawsuit.

• Threat to file a frivolous civil lawsuit.

• Threatening the other party's economic interests.

What is the Statute of Frauds?

A state law requiring certain types of contracts to be in writing to be legally enforceable.

What are the three main purposes of the Statute of Frauds?

• Provide reliable evidence of a contract's existence and terms to ease negotiations.

• Prevent unreliable oral evidence from interfering with contracts.

• Prevent parties from being forced into contracts they do not agree with.

What six types of contracts fall within the Statute of Frauds?

• One-Year Rule: Performance cannot possibly be completed within 1 year of making.

• Marriage: Prenuptial agreements (promises made in consideration of marriage).

• Secondary Obligations: Guarantees/suretyships to pay someone else's debt.

• Real Property: Contracts involving interests in land.

• Sale of Goods: Valued at $500 or more (under the UCC).

• Executor: An executor promising to pay estate debts with personal funds.

One-Year Rule

Performance cannot possibly be completed within 1 year of making

Prenuptial Agreements

Promises made in consideration of marriage – beyond return promise to marry.

Secondary Obligations

Contracts for one party to pay the debt/default of another party (guarantee/suretyship)

Real Property

Contracts involving interests in land.

Sale of Goods

Contracts for sale of goods valued at $500 or more (per the UCC).

Executor

legally appointed to be in charge of dead persons asset distribution. When person agrees to pay estate’s debts with their own money → written contract required

What must a written contract include to satisfy the Statute of Frauds under Common Law?

• Names of the parties.

• Subject matter/purpose.

• Consideration given by both sides.

• All relevant contractual terms (price, etc.).

• Signature of the party against whom action is brought (the defendant).

What is required to satisfy a writing under the UCC?

Only the quantity term and the signature of the person refusing to perform.

What are the four major exceptions where an oral contract is enforced despite the Statute of Frauds?

• Admission

• Partial Performance

• Promissory Estoppel

• UCC Exceptions

Addmisison

Statement made in court, under oath, or within legal proceeding where defendant admits oral contract (even though contract required to be in writing).

Partial performance

Performance of portions of unwritten agreement can constitute proof oral contract exists (ex. improvements made to land, paid part of land price, taken possession).

Promissory estoppel

Legal enforcement of otherwise unenforceable contract due to party's detrimental reliance on contract.

UCC Exceptions

The UCC allows certain oral contracts over $500 to be legally binding without a signed agreement, such as when merchants confirm a spoken deal in writing or when a seller creates custom goods that cannot be resold.

What is the Parol Evidence Rule?

A common law rule stating that oral evidence of an agreement made before or at the same time as a final written contract is inadmissible if it substantially contradicts that writing.

When can oral (parol) evidence be admitted to court?

• To show a subsequent modification (made after the writing).

• To prove a contract was conditioned on orally agreed terms.

• To clarify ambiguous terms or fill in the gaps of an incomplete contract.

• To fix obvious typographical errors.

• To prove a contract is void or voidable.

• To show prior dealings or trade usage (under the UCC).

What are the five primary ways a contract can be discharged?

• Occurrence or nonoccurrence of a condition.

• Complete or substantial performance.

• Material breach of contract (discharges the nonbreaching party's duties).

• Mutual agreement.

• Operation of law.

What are compensatory damages?

The most common type of monetary remedy; they cover direct losses and costs to put the plaintiff in the position they would have been in if the contract had been fully performed.

What is the difference between consequential and punitive damages?

• Consequential: Covers indirect but foreseeable losses that were not explicitly in the contract.

• Punitive: Designed to punish the breaching party and deter similar conduct in the future.

What is the difference between nominal and liquidated damages?

• Nominal: Symbolic. A small award given when a wrongful breach occurred, but no actual financial damage was suffered.

• Liquidated: pre-determined. Damages whose amount is explicitly specified within the contract itself ahead of time.

What is the duty to mitigate damages?

if someone harms you, you must take reasonable steps to keep your losses from getting worse. Failure to do so can drastically reduce or eliminate their court award.

What are rescission and restitution?

• Rescission: The formal termination/unwinding of the contract.

• Restitution: The mandatory return of any property or goods transferred under that contract.

What is a Specific performance remedy?

order by court requiring breaching party to fulfill contract obligations; usually awarded only when monetary damages inadequate and subject matter of contract unique.

What is a injunction remedy?

order by court forcing person to do something or prohibiting from doing something (usually a prohibition against certain actions).

What is reformation?

An equitable remedy where the court physically rewrites the contract to accurately reflect the true, actual agreement of the parties.

What four things should a party evaluate before filing a lawsuit for breach of contract?

• The likelihood of winning the case.

• The desire or need to maintain an ongoing relationship with the defendant.

• The possibility of getting a better/faster resolution through Alternative Dispute Resolution (ADR).

• The overall financial cost of litigation/ADR compared to the actual value of the likely remedy.

What is a tort?

Wrongful conduct by one person that causes injury to another’s person (outside of a breach of contract), property, or economic interests.

What are the main differences between a tort and a crime?

• Torts: Civil actions brought by individuals; liability results in money damages or relief for harm.

• Crimes: Wrongs against society prosecuted by the state; punishment results in fines, imprisonment, or death.

• Note: Some actions (like battery) can be both.

What are the four primary purposes of tort law?

• Compensate innocent injured persons or property.

• Prevent private retaliation.

• Reinforce the vision of a just society.

• Deter future wrongs.

What are the three classifications of torts?

• Intentional

• Negligent

• Strict Liability

Intentional Tort

Defendant takes action intending harm or knowing it is likely to occur.

Negligent Tort

Defendant acts carelessly, subjecting others to an unreasonable risk of harm.

Strict Liability Tort

The defendant did something so dangerous that it is impossible to make it 100% safe, no matter how careful they are.

What is the difference between assault and battery?

• Assault: Intentionally placing a person in fear or apprehension of immediate bodily harm.

• Battery: When the physical contact actually occurs.

What are the four primary defenses to assault and battery?

Consent, self-defense, defense of others, and defense of property.

What is defamation?

The intentional publication/communication of a false statement to a third party that harms an individual's reputation.

What are the two types of defamation?

• Libel: Published/written defamation.

• Slander: Spoken/oral defamation.

Defenses to defamation?

truth and privilege

What are four other common intentional torts against persons?

• Invasion of Privacy: (False light, public disclosure of private facts, commercial appropriation, or intrusion on seclusion).

• False Imprisonment.

• Intentional Infliction of Emotional Distress (IIED).

• Misuse of Legal Procedure.

What are the four common intentional torts against property?

• Trespass to Realty: Going onto someone else's land without permission.

• Trespass to Personal Property: Borrowing/using someone's personal property without permission.

• Conversion: Permanently depriving an owner of their personal property.

• Private Nuisance: Interfering with an owner's enjoyment of their land (e.g., flooding, excessive noise, or smoke).

What are the five common intentional torts against economic interests?

• Disparagement: Making false statements about a business's product or service.

• Intentional Interference with Contract: Inducing a party to breach a valid contract.

• Unfair Competition.

• Misappropriation: Using someone's Name, Image, or Likeness (NIL) without permission.

• Fraudulent Misrepresentation.