T 5. A contract should be held enforceable even if a party is mistake.pdf
- 1. T 5. A contract should be held enforceable even if a party is mistaken about the F value or quality of an item purchased. T F 6. A contract may be determined unenforceable if both parties were mistaken about an important fact, but not if only one party was mistaken. TF7. The contract defense of fraud requires some false statement of a factual nature. TF 8. A statement that no reasonable person would believe is probably not fraudulent. T F 9. Duress involves a statement by a person who has special influence over TF 10. Some contracts must be in writing to be enforceable. T F 11. Real estate contracts typically must be in writing to be enforceable. TF 12. A contract covered by the Statute of Frauds must be signed by both parties. T F 13. A party may be able to transfer their rights and duties under a contract to another, such as a trusted friend or advisor. another party T F 14. An award of punitive damages is very common for contract breach. T F 15. A party may be entitled to foreseeable damages beyond the contract itself but which result from a breach of the contract, such as lost profits. F 16. The party breaching a contract has a duty to mitigate the damages which will T result from his/her breach. T F 17. Liquidated damages are an agreed amount to be paid for a future breach. Solution 5. False: This is the case of unilateral mistake in a contract. Unilateral mistake occurs when one party is mistaken as to the subject matter or the terms contained in the contract. One party is mistaken and the other is not. Since only one party is mistaken it may lead to the unfair advantage of to the other party. Therefore when a contract was entered on the basis of unilateral mistake the contract may be liable to recession or reformation. Unilateral mistake commonly occurs in prices, quantities and description of goods and services. 6. False. If both the parties to an agreement are mistaken about the subject matter of the contract, such contract is void. 7. True: Fraud means concealment of a material fact or misrepresentation of a material fact. A fraud in contract occurred when one party of the contract presents information to another which is incorrect, deceitful or intend to confuse the other party. 8. True. Misrepresentation is a statement that no reasonable person would believe it to be true. 10. True. Contracts may be written or oral and both are enforceable. Oral contracts are very difficult to enforce because there is not clear record on the offer, consideration and acceptance. Therefore the law requires some agreement must be in writing in order to bind both the parties. Such agreements are agreement to pay debts, contract that takes longer than one year to complete, real estate lease for more than one year, contracts for above certain amount of money, contract which has duration over the life time of the party and transfer of property at the death of the party performing the contract.
- 2. 11. True. The law requires some agreement must be in writing in order to bind both the parties. Such agreements are agreement to pay debts, contract that takes longer than one year to complete, real estate lease for more than one year, contracts for above certain amount of money, contract which has duration over the life time of the party and transfer of property at the death of the party performing the contract. 12. True: A written contract signed by both the parties satisfies the requirements of the statute of frauds. 13. True: One can legally transfer his rights and duties under a contract on which the person has agreed to a third party unless the contract specifically mentions that the rights and duties cannot be transferred. This is called assignment of contract. 14. False: English Jurisprudence prohibits the award of punitive damage for the breach of contract while the Canadian Jurisprudence allows it. Award of punitive damage is not common. 15. True: Foreseeable damages are damages that both the party to the contract knew or should have been aware at the time of contracting. The party is entitled to such foreseeable damage as a result of the breach of contract. 16. False: The non reaching party must take all reasonable steps to mitigate the loss consequent upon the breach and debars him from claiming any part of the damage which arise from his neglect to take such mitigating steps. 17. True: Liquidated damages are the damages specified by the contracting parties at the time of contracting. If the amount is not specified it must be determined by the court.