Business Law Note2
Essay Preview: Business Law Note2
Report this essay
09-27-2011
Consideration continues:
A promise is not a promise without a bargain for exchange.
Example: An uncle offered his niece a place to stay on his property because she had nowhere to live. The woman had 10 children, and she moved from Michigan with her children to Macon county Alabama to live on her uncles property. The uncle decided that she and her children were too much so he asked to live his property. The niece sued her uncle, but she lost because there was no bargain for exchange. However the niece uses the Promissory Estoppels (a term used in contract law that applies where, although there may not otherwise be an enforceable contract, because one party has relied on the promise of the other, it would be unfair not to enforce the agreement.)
It arises from a promise which the promisor should reasonably expect to induce action or compassion of a definite and substantial character on the part of the promisee and which does induce such action or forbearance in binding if injustice can be avoided only by enforcement of the promise.
If the promisor make the type promise that would lead to a reasonable to take defective or substantial action in reliant upon the promise, and does take action the promisor should be estoppels from using of lack of consideration as a defense.
Duress: duress is a defense to a crime if the defendant was compelled or coerced to commit the crime by some human agency, prior to a safe avenue of escape being available, under a threat of serious imminent harm to the defendant or others, and the crime is of a lesser magnitude than the harm threatened. Duress consists of threatening conduct which produced the following three elements in the accused:
Two types of duress: Extreme or physical, and undue influence (a sudtle form of duress)
Extreme or physical void the contract.
Economic duress
Wrongful inducement of contracts
By one in a superior bargaining position
Depriving the victim of any meaniful choice
Undue influence: a term often used in will contests to refer to outside pressures which negate the free will of the testator (will maker), so that the maker of the will lacks the necessary mental capacity for a valid will. Undue influence may take the form of isolating the weaker person, promoting dependency, or inducing fear and distrust of others, among other manipulations. Undue influence, like mental capacity, raises the question of whether an individual is acting freely. Duress is usually claimed as a factor in the conclusion that undue influence existed. However, duress is a causative factor, whereas undue influence is a determination that the person lacked the required mental state to legally make a decision due to duress
Take unfair advance of the victim
By mean of dominant position
In a confidential relationship (such as lawyer/client doctor/patient)
Fraud in the execution renders the contract void.
agreeing to something other than one intended
agreeing to something never intended
Example- John Deere tractor sold a farmer tractor, and instead of charging it to the farms account charge it to the farmer personal account. The farmer went bankrupt and later John deer came after the farmer for the cost of the tractor.
The contract was rendered void.
Because farmer did not agree to put the tractor on his personal account.
Fraud in the inducement: fraud or deceit is an intentional misrepresentation of material fact to the other, who consents to enter into a contract in justifiable reliance on the misrepresentation.
Fraud in the inducement renders the contract voidable by the defrauded party.
the requisites for fraud in the inducement
a false representation
of a fact
that is material
made with knowledge of its falsity and the intention to deceive
jusitably relied upon by the plaintiff;
Knowledge of falsity and intention to deceive; consist of
Actual knowledge
Lack of belief in the statements truthfulness
Reckless indifference as to its truthfulness
Fraud – generally defined in the law as an intentional misrepresentation of material existing fact made by one person to another with knowledge of its falsity and for the purpose of inducing the other person to act, and upon which the other person relies with resulting injury or damage. Fraud may also be made by an omission or purposeful failure to state material facts, which nondisclosure makes other statements misleading.
To constitute fraud, a misrepresentation or omission must also relate to an existing fact, not a promise to do something in the future, unless the person who made the promise did so without any present intent to perform it or with a positive intent not to perform it. Promises to do something in the future or a mere expression of opinion cannot be the basis of a claim of fraud unless the person stating the opinion has exclusive or superior knowledge of existing facts which are inconsistent with such opinion. The false statement or omission must be material, meaning that it was significant to the decision to be made.
Sometimes, it must be shown that the plaintiffs reliance was justifiable, and that upon reasonable inquiry would not have discovered the truth of the matter. For injury or damage to be the result of fraud,