Contracts II

Policing Doctrines

doctrines that allow courts to look beyond objective assent where agreement was obtained through improper means

purpose of policing doctrines

to ensure assent is voluntary & not obtained through improper bargaining

types of policing doctrines

fraudulent misrepresentation
duress
unconscionability

void contract

contract that is a legal nullity & cannot be enforced by either party

voidable contract

valid contract that may be rescinded at the option of the aggrieved party

recission

equitable remedy that cancels the contract & returns parties to their pre-contract position

restitution

remedy that prevents unjust enrichment by requiring the return of benefits conferred

difference between void & voidable contracts

void contract never existed & cannot be enforced
voidable contract is valid unless aggrieved party chooses to rescind it

misrepresentation

assertion that is not in accord with the facts

when does misrepresentation make a contract voidable

when it induces assent and the recipient relies on it

fraudulent misrepresentation

misrepresentation made with knowledge of falsity or reckless disregard and intent to mislead

scienter

mental state required for fraud

material misrpresentation

misrepresentation that would induce a reasonable person to assent

concealment

active steps taken to hide a fact, treated as misrepresentation

when does silence constitute fraud

when there is a duty to dislcose

when does duty to disclose arise

when necessary to correct a prior statement, a basic assumption mistake, a misunderstanding of writing