LAW 122 Lecture Notes - Uberrima Fides, Contractual Term, Rescission

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Published on 19 Apr 2013
School
Ryerson University
Department
Law and Business
Course
LAW 122
Professor
Chapter 9 Representations and TERMS
PRE-CONTRACTUAL AND CONTRACTUAL STATEMENTS
Not every statement communicated during the negoition process is a contractual
term
Contractual Term: is a provision in an agreement that creates a legally enforceable
obligation
Contractual term is a promissory statement
Pre-Contractual representation: is a statement one party makes by words or
conduct with the intention of inducing another party to enter into a contract
It does not impose a contractual obligation, it could induce the creation of a
contract, it does not form part of that contract
MISREPRESENTATION
The distinction between contractual terms and precontractual representation is
especially important if a statement is false
If a non contractual statement is false, we say that one of the parties has made a
misrepresentation
Nature of Misrepresentation
Misrepresentation: is a false statement of a fact that causes the recipient to enter
into a contract
A contractual term cannot be false when it is given,
A breach occurs when one party fails to perform precisely as promised
Misstatement of fact
Not every misstatement during pre-contractual negations is a misrepresentation
Misrepresentation occurs only if the speaker claimed to state a fact
People often make non-factual statements during negations
Give their own Opinion: is the statement of a belief or judgment
During a pre-contractual negation a person may describe how they will act in the
future
A non promissory statement as to a party’s future conduct is not usually treated as a
missreprentation
A court may find a misreprenstation if you inaccurately describe the consequence
of a law, because those consequences are treated as a matter of fact rather than
law
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Document Summary

Not every statement communicated during the negoition process is a contractual. Contractual term: is a provision in an agreement that creates a legally enforceable term obligation. Pre-contractual representation: is a statement one party makes by words or conduct with the intention of inducing another party to enter into a contract. It does not impose a contractual obligation, it could induce the creation of a contract, it does not form part of that contract. The distinction between contractual terms and precontractual representation is especially important if a statement is false. If a non contractual statement is false, we say that one of the parties has made a misrepresentation. Misrepresentation: is a false statement of a fact that causes the recipient to enter into a contract. A contractual term cannot be false when it is given, A breach occurs when one party fails to perform precisely as promised. Not every misstatement during pre-contractual negations is a misrepresentation.

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