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Department
Law and Business
Course
LAW 122
Professor
Leigh Lampert
Semester
Winter

Description
Law 122Chapter 912 Professor Leigh LampertCHAPTER9REPRESENTATIONSANDTERMSPreContractualandContractualStatementContractualtermAprovisioninanagreementthatcreatesalegallyenforceableobligationContractualtermbyitsnatureisapromissorystatementPeoplevoluntarilyagreetodosomethingintheFUTUREoBreachesacontractiffalsePrecontractualrepresentationAstatementonepartmakesbywordsorconductwiththeintentiontoinducinganotherpartytoenterintoacontractDoesNotimposeacontractualobligationitisastatementofexistingfactsoMisrepresentationiffalseNoteifacontractualstatementisnotfulfilledwesaythatonepartyisnbreachofcontractMisrepresentationItisanincorrectstatementofanexistingfactregardlessofpastpresentmainfeatureisthatitisfalsewhenitsmadeIncontrastacontractualtermismeanttoprovideapromiseoffutureperformanceGivenitspromissorynatureacontractualtermcannotbehaleswhenitisgivenMisstatementofFactAmisrepresentationoccursonlyifthespeakerclaimedtostateafactThedifficultywiththatrequirementisthatpeopleoftenmakenonfactualstatementsduringnegotiationsOpinionisastatementofabeliedorjudgmentTheycanrangefromcarefreespeculationtodeliberateassessmentbasedonasubstantialbodyofevidenceAstatementoffutureconductisnotastatementoffactItisastatementaboutpersonfutureintentionshoweverastatementoffutureconductisamisrepresentationifitismadefraudulentlyoExampleIcertainlydonointenttoselltheneighboringlandtoMelissaThisstatementcontainsanindicationofyoupresentstateofmindandwillbecharacterizedasanimpliedstatementoffactiffalseitcanbefraudulentmisrepresentationSilenceasMisrepresentationPartiesarenotrequiredtodisclosematerialfactsduringprecontractualnegotiationregardlessofunethicalnondiscloseWhensilencewoulddistortapreviousassertionWhenastatementishalftrueWhenthecontractrequiresadutyofutmostgoodfaithWhenaspecialrelationshipexistbetweenthepartiesWhenastatutoryprovisionrequiresdisclosureWhenfactsareactivelyconcealedInducementForastatementtobeactionableasamisrepresentationthedeceivedpartmustprovethathefalsestatementinducedthecontractThestatementmusthavemisleaditsrecipientintocreatingthecontractThestatementdoesnothavetobetheonlyinducingfactorTheLegalConsequences1TheremedyofrescissionItisthecancellationofacontractwiththeaimofrestoringthepartiestothegreatestextentpossibletotheirprecontractualstate1Law 122Chapter 912 Professor Leigh LampertRestitutionistheremedyofrescissionisoftenaccompaniedbyanorderforrestitutionitinvolvesagivingbackandtakingbackonbothsidesExampleYoumanufacturesnowboardsandneedtoorderasteadysupplyofwaterproofpaintsAsupplierhaswaterproofpainttosellbutinsiststhatyouagreetopurchase4shipmentsoverthenext2yearsYouagreerequisitionachequeandsendittothesupplierWhenshipmentarrivesitisNOTwaterproofthereforeuselessYouaskformoneybutsupplierrefusesAssumingthatyoudidntpayforqualitypaintyouseekanorderofrescissionfromthecourtsinsteadofdisregardthecontractoRestitutionistheappropriateremedythecourtwilltrytorestoretheprecontractualsituationbyallowingyoutorecoverthemoneyatthesametimethatitallowsthesuppliertorecoverpaintAffirmationIfthemisleadpartyaffirmedthecontractthenrescissionisnotavailableAffirmationoccurswhenthemisledpartydeclaresanintentiontocarryoutthecontractorotherwiseactsasthoughitisboundbyit2TherighttodamagesDamagesareintendedtoprovidemonetarycompensationforthelossesthatapersonsufferedasaresultofrelyinguponamisrepresentationaIfthedamagesareawardedforamisrepresentationtheplaintiffsclaimarisesnotincontractbutratherintortInnocentMisrepresentationIsastatementapersonmakescarefullyandwithoutknowledgeofthefactthatitisfalseTheonlylegalremedyavailableforinnocentmisrepresentationisrescissionandrescissionisavailableonlywhenthereisasubstantialdifferencebetweenwhatthedeceivedparthadbargainedforandwhatwasinfactobtainedElementsofProofFalsestatementoffactormisleadingsilenceinducingcontractNegligentMisrepresentationAfalseinducingstatementmadeinanunreasonableorcarelessmannerFalsestatementmadeinanunreasonablemannerinducingacontractcausingalossthatisnotalwayssufficientlyremediedbyrecessionDamagesinTortFraudulentMisrepresentationOccurswhenapersonmakesastatementtheyknowisfalseorthattheyhavenoreasontobelieveistrueorthatisrecklessFalsestatementmisleadingsilencemadewithouthonestbeliefinitstruthinducingcontractcausingalossnotalwayssufficientlyremediedbyrecissionoDamagesinTortCONTRACTUALTERMSTheintentionofthepartiesiskeytounderstandthedifferencebetweenrepresentationandterms2typesofcontractualterms1TermsexpressedbythepartiesAnexpresstermisastatementmadebyoneofthepartiesthatareasonablepersonwouldbelievewasintendedtocreateanenforceableobligationProofofExpressTermsItisoftendifficulttoprovethetermsofacontractthatwascreatedorallyItisuptothecourttodecidewhoismorebelievableOralagreementsarebindingoIfanagreementiswrittenoralevidencegenerallycannotbeusedtoaddtosubtractfromqualifyorvarythetermsofthedocumentoParolevidenceIfanagreementiswrittenoralevidencegenerallycannotbeusedtoaddtosubtractfromqualifyorvarythetermsoftedocumentItreferstoevidencethatisnotcontainedwithinthewrittencontract2
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