Transcript Genuine Agreement

Genuine Agreement
Chapter 8 in the business law text
“Meeting of the Minds”
Offeror and offeree must both agree on
the contractual terms.
 If there is no “meeting of the minds”
there is no contract

Mistake
unilateral mistake
 bilateral, or mutual, mistake

Unilateral Mistake
an error on the part of one of the parties
to the contract
 This ordinarily does not make the
contract voidable.
 Types of unilateral mistake
– as to the nature of the agreement
– as to the identity of a party

Bilateral Mistake
an error on the part of both (or all) of the
parties to the contract
 This makes the contract voidable by
either party.
 Types of bilateral mistake
– as to the possibility of performance
– as to the subject matter

Fraud (deceit)
deliberate deception to secure an unfair
or unlawful gain
 Persons induced into a contract by
fraud have a choice.
– rescind, or cancel the contract
– sue for monetary damages

Fraud - the five elements
false representation of fact
 party making the representation must
know it’s false
 representation made with the intent it be
relied upon
 reasonable reliance by innocent party
on the representation
 monetary loss

Innocent Misrepresentation
representation which turns out to be
false but which was believed to be true
at the time it was made
 The other party may rescind the
contract but may not sue for monetary
damages.

Duress
overcoming a person’s will be use of
force or by threat of force or bodily harm
 If actual force is used, the contract is
void.
 If the threat of force is used, the
contract is voidable by the innocent
party.
– The threat may be to the innocent
party or to a family member.

Undue Influence
unfair and improper persuasive
pressure exercised by one person in a
relationship of trust with another person
 The contract is voidable by the innocent
party.
