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ADMS 2610 (485)


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Administrative Studies
ADMS 2610
Robert Levine

ADMS2610 Session 3 Chapter 11 (pg. 197-210) Failure to Create an Enforceable Contract Requirements for a valid contract - Essential elements such as offer, acceptance, intention, consideration, capacity may all exist but contract may still not be enforceable - Situations which may render a contract unenforceable o Mistake, misrepresentation, undue influence, duress - Also determines who bears the brunt of a given loss Mistake – a state of affairs in which a party (or both parties) has formed an erroneous opinion as to the identity or existence of the subject matter, or of some other important term - Types of Mistake o Mistake of law  Presumed to know the law  Usually no relief provided  Exception: if statute provided for recovery o Mistake of fact  Mistake as to the existence of the subject matter of the contract or the identity of a party  Court may provide relief if:  Mistake as to subject matter of contract o General rule, contract is void  Mistake as to identify of the party o Depends if the identity of the person is an essential element of the agreement o If essential may not be enforceable o If not essential, it will be enforceable o Non Est Factum (“it is not my doing”)  A defense that may allow illiterate or infirm persons to avoid liability on a written agreement if they can establish that they were not aware of the true nature of the document, and were not careless in its execution  Narrow form of mistake  Applies only to type of agreement being singed not to terms of the agreement o Unilateral Mistake  A mistake by one party to the agreement o Mutual Mistake  A mistake where both parties have made mistaken assumptions as to the subject matter of the agreement  Can be same mistake or different mistakes  Courts will not enforce agreements when the other party is aware of the mistake being made  Rules:  If both parties make the same mistake: o As to subject matter, then the contract is unenforceable o As to identify of the parties, it is dealt with on a case by case basis  Rectification o The correction of a mistake in an agreement that would have rendered the agreement impossible to perform, essentially for the correction of typos or editorial errors that distort the intention of the parities Misrepresentation - A statement of conduct - Induces the other party to enter into the contract - Must be about a material matter - Must be a statement of fact and not opinion o Exception: expert opinion - Statement
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