Management and Organizational Studies 2275A/B Chapter Notes - Chapter 8: Medieval Commune, Unconscionability

• School: Western University
• Department: Management and Organizational Studies
• Course: Management and Organizational Studies 2275A/B
• Professor: Philip King

Document Summary

Voidable contract a contract that, in certain circumstances, an aggrieved party can choose to keep in force or bring to an end. Void contract a contract involving a defect so substantial that it is of no force or effect. Legal capacity - the ability to make binding contracts. Economic duress the threat of economic harm that coerces the will of the other party and results in a contract. Undue influence unfair manipulation that compromises someone"s free will. Actual pressure: arises because one party has exerted unfair influence on the other. Presumed pressure: relationship that already exists between parties gives rise to a presumption that the ensuing agreement was brought about by unfair manipulation. Unconscionability unconscionable contract an unfair contract formed when one party takes advantage of the weakness of another. Proof of unconscionability involves a two-step process: proof of inequality between the parties, proof of an improvident bargain or proof of exploitation.