Chapters 8 and 9

Question 1

What is Legal Capacity

Answer 1

The ability to make a binding contract.

Question 2

What are the 3 exceptions to enforcing a contract?

Answer 2

1. Unequal Relationship between parties
2. Misrepresentation
3. A defect in the contract

Question 3

Define Void Contract

Answer 3

A contract that involves a defect that can impair the effectivness of the terms

Question 4

Voidable Contract

Answer 4

A contract, that when under certain circumstances, a party can choose to end it.

Question 5

Define Age of Majority

Answer 5

The age in which someone becomes a legal adult

Question 6

Can minors enter into a contract?

Answer 6

Yes, but they are not legally obligated to fulfill the terms

Question 7

True or False: Contracts that are made where at least one party is mentally incapacitated are still acceptable.

Answer 7

False: If it can be proven that at least one party was not capable of understanding the full terms of the contract, it cannot be legally enforced

Question 8

Define the term ‘Duress’

Answer 8

The threat of physical or economic harm that results in a contract

Question 9

Define Undue Influence.

Answer 9

Unfair manipulation that compromises someone’s free will or choice.

Question 10

Can Undue influence be actual peasure or presumed preasure or both?

Answer 10

Both

Question 11

Define Unconscionable contract.

Answer 11

An unfair contract formed when one party takes advantage of the weakness of another

Question 12

What is the two step process to prove a contrcat is Unconscionable?

Answer 12

1.Proof of inequality between parties
2. Improvident bargain or proof of exploitation.

Question 13

Define Misrepresentation.

Answer 13

A false factual statement that caused someone to enter a contract

Question 14

What is Recission?

Answer 14

The remedy to Misrepresentation that results in the parties returning to pre-contractual positions.

Question 15

What are the three main categories of misrepresentations?

Answer 15

1. Fradulent: Intentionally misleading
2. Negligent: Careless when making a statement
3. Innocent: Simply misrepresented a fact.

Question 16

What is a remedy for all misrepresentation?

Answer 16

Recission

Question 17

Which two cateogires of misrepresentation can be remedied by tort damages?

Answer 17

Fraudlent and Negligent

Question 18

What is the difference between a mistake and a common mistake?

Answer 18

In a common mistake both parties share the same fundamental mistake.

Question 19

Can a party concealing or only providing partial information be interpreted as misrepresentation?

Answer 19

Yes

Question 20

Are contracts formed under duress or undue influence voidable or void?

Answer 20

Voidable

Question 21

What are some parts of actionable Misrepresentation?

Answer 21

False
Clear and obvious
Significant to deciding the contract
Induces a party into the contract
Concerned with facts, not opinions.

Question 22

What is a mistake?

Answer 22

An error made by at least one party that seriously undermins the contract.

Question 23

What is rectification?

Answer 23

The remedy available where parties have made a mistake in recording their agreement.

Question 24

What is an Illegal contract?

Answer 24

A contract that cannot be enforced becuase it’s contrary to legislation.

Question 25

What are the two instances in which a contract is illegal

Answer 25

1. Is contrary to a specific statute 2. Violates Public Policy

Question 26

What is Public Policy?

Answer 26

The community's common sense and common conscience.

Question 27

Define the Statute of Frauds.

Answer 27

A statute that requires certain contracts to be in writing and enforcable (ie sale of goods, deals with land, etc.)

Question 28

Do all contracts have to be in writing to be enforcable?

Answer 28

No. Oral contracts can be enforcable if it's proven in different ways(ie a witness to the deal)

Question 29

* Are the parties under any legal incapacities? * Has one party taken unfair advantage of the other? * Has one party misled the other? * Has a substantial mistake been made? * Is the contract contrary to legislation or in violation of public policy? * Is the contract required to be in writing? These are all examples of what?

Answer 29

The risks of Unenforceability

Question 30

List the 4 ways in which a contract can be brought to an end (Terminated)

Answer 30

1. Performance 2. Agreement 3. Frustration 4. Breach

Question 31

Define Vicarious Performance

Answer 31

Performance of contractual obligations through others

Question 32

What is the act of Novation

Answer 32

The act of enterig into an entirely new contract after the exisiting one becomes unfavourable

Question 33

What's Allignment of a contract?

Answer 33

The transfer of a right by an assignor to an assignee

Question 34

Define Termination by Frustration

Answer 34

Termiantion by an unexpected event or change that makes contractual performance functionally impossible or illegal

Question 35

What is a Force Majeure Clause?

Answer 35

They deal with risks of unforseen events (Ie natural disasters, war, devaluation, rationing of raw materials, etc.) and allow parties to delay/terminate a contract

Question 36

What is Balance of probabilities?

Answer 36

Proof that there is a 50% chance or greater that the circumstances of the contrcat are as the plaintiff contends.

Question 37

What is an Anticipatory Breach?

Answer 37

A breach that occurs before the date of performance

Question 38

What is the remedy for a breach?

Answer 38

Damages -- Monetary compensation

Question 39

What is the difference between Pecuniary and Non-Pecuniary Damages?

Answer 39

Pecuniary damages are for financial loss. Non-Pecuniary refers to loss of enjoyment and mental distress.

Question 40

Expectation Damages

Answer 40

Provide the plaintiff with monetary equivilant of contractual performance

Question 41

Punitive Damages

Answer 41

Award to plaintiff to punish defendant for malicious, oppressive, and high-handed conduct.

Question 42

What are equitable remedies in contract law?

Answer 42

Remedies used in rare situations where damages are inadequate to address a breach of contract.

Question 43

What is specific performance?

Answer 43

An equitable remedy where the court orders the breaching party to do exactly what the contract obligated them to do.

Question 44

When is specific performance available?

Answer 44

Only when the subject of the contract is unique and cannot be replaced by money.

Question 45

Can a court refuse specific performance?

Answer 45

Yes, the court can refuse to grant it under certain circumstances.

Question 46

What is an injunction in contract law?

Answer 46

A court order directing a party not to engage in specified activities; may be in addition to damages.

Question 47

When is an injunction commonly used?

Answer 47

To restrain a party from breaching a promise not to do something.

Question 48

What is an interlocutory injunction?

Answer 48

A temporary order requiring someone to refrain from certain actions until the dispute is fully resolved.

Question 49

Unjust Enrichment

Answer 49

Occurs when one party has undeservedly or unjustly secured a benefit at the other party's expense.