CHAPTERS 13 and 14
ASSENT AND UNDUE INFLUENCE
Assent (agreement): the requirement that the party’s agreement to a contract be genuine. Genuine assent
may be missing because party’s entered into a traditional/e-contract based on mistake, fraudulent
misrepresentation, duress or undue influence.
Unilateral Mistakes: occurs when only one party is mistaken about material fact regarding
subject matter of contract. Usually mistaken party cannot back out of contract and contract will be
Ex: buyer purchases an automobile thinking that the engine is a v-8 when in fact it’s a v-6, this
does not excuse buyer from contract.
Mutual Mistake -
Mutual Mistake of Fact: a mistake made by both parties to a contract concerning a
material fact that is important to the subject matter of the contract. Both parties can get
out of contract.
Not Mutual Mistake of Value: exists if both parties know the object of the contract but
are mistaken as to its value. Ex: If Helen sells a painting to quant for $200 and then quant
finds out that it’s actually worth $2million, Helen cannot recover painting.
Fraud: when a person makes an assertion about a given fact and he knows it is not true, he is committing
fraud. The innocent party’s agreement to contract is not genuine & the contract is voidable by the
Ex: If you wanted to buy my house and I ask if I had foundation work on it and I lied and said no, you
can prove and say I lied. You lied to someone and someone else believes you.
Key Elements of Fraud: to prove fraud
1. Lie about a material fact: misrepresentation must have been a significant factor in
inducing the innocent party to enter into the contract.
2. Intent to Lie: to prove fraud, person making the misrepresentation must have either
had knowledge that the representation was false or made it without sufficient
knowledge of truth.
3. Reasonable Reliance: you have to reasonably rely on lie.
3. Damages: to recover damages, innocent party must prove that the fraud caused
him/her economic injury. The measure of damages is the difference between the
actual value of the property and the value represented.
Ex: you can get difference of house with foundation problems or without foundation
problems or get out of contract.
Fraud in Inception: when the person does not know what he/she signed or that they
were even signing. You can get out of contract. Lie about fact that there was actually a
Fraud in the Inducement: you knew you were signing contract but you did not know there was fraud involved like house with bad foundation.
Fraud of Concealment: purposely conceal damage
Silence as Misrepresentation: If you go buy a car and you don’t ask questions about it,
law does not impose other person to tell you about damage. Not saying what is wrong
because no one asked. I can keep silent; I don’t have to tell you about damage.
Misrepresentation of Law: generally does not void contract.
Innocent Misrepresentation: when I tell u something and I am not intending to lie. Not
intentionally lying like I don’t know think foundation has ever been fixed, but in reality
previous owners fixed it.
Duress: when one party threatens to do a wrongful act unless other party enters into a contract.
(When there is a gun pointed at your head to get into contract.)
Undue Influence: when one person takes advantage of another person’s mental, emotional, or physical
weakness & unduly p