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Fast Overview on Fraudulent Misrepresentation

Fast Overview on Fraudulent MisrepresentationFraudulent misrepresentation can be shown where the party engaging in fraud had knowledge that not sharing the information would compel action by the other party. The omission of material facts can only be considered a fraudulent misrepresentation if it was intentional and the information was known to the accused. 

Fraudulent misrepresentation by silence may result during a long contract negotiation if one of the parties to the contract withholds material information they learned during the negotiation process.

Understanding Severable and or Divisible Contracts

Understanding Severable and or Divisible Contracts

A severable contract is a contractunenforceable that can still remain in effect despite those provisions which are void. In order for the blue pencil test to be satisfied, the phrase stricken by the court must not result in a change to the purpose for which the contract was created by the parties. The contract must still make grammatical sense after the edits have been made to the contract. Otherwise the contract will not be considered to have become a severable contract.
A severable contract can be formed if the parties who entered into the contract do not consider it essential that all the actions be performed together. Divisible contracts may exist if a convenience store orders the soda, chips and candy it sells from the same company in three separate clauses. An indivisible contract is formed if the store hired a vendor to provide the soda, chips, and candy in a single clause. 
Whether divisible contracts or indivisible contracts have been formed can often be determined by examining the terms under which consideration has been provided. If the set of contracts provide the consideration in a lump sum, it is usually an indivisible contract. If consideration is itemized for each thing exchanged, a severable contract often exists.
If a contract contains both legal and illegal clauses, the court will attempt to enforce only the legal clauses in the event the contract is already a severable contract. If the court can employ a blue pencil test to create a severable contract, it will.

Knowing the Exculpatory Clause

Knowing the Exculpatory Clause

An exculpatory clause is a clause of a contract in which one of the parties releases the other party from liability for their actions. An exculpatory clause may or may not be considered contrary to the public interest depending upon what field the party seeking the release of liability typically operates.
A contractual clause which limits liability is not automatically grounds that the contract will be declared unenforceable during a contract dispute. Limited liability clauses are permitted in many contracts. The only time they may become an issue is if the contract dispute involves an exculpatory clause that seeks to invalidate the liability claim regardless of which party is at fault.
An exculpatory claim in which the liability for all personal injury or monetary damage will frequently be upheld if the party seeking relief is a private business, such as an amusement park, health club, or general recreational facility. Relief is often granted from suits filed against parties that are not considered essential to the public good or involved in public health. For these types of companies, exculpatory clauses are generally held to be enforceable. 
A contract dispute with a public utility company, a bank, or a company which carries public goods in which an attempt is made to invoke an exculpatory clause is usually bound for failure. The courts have generally invalidated exculpatory clauses in these contracts because of the belief that allowing these companies to escape liability would be detrimental to the public good.
If a lease contains an exculpatory clause it may be enforceable or unenforceable depending on the purpose for which the property is leased. If an exculpatory clause is present when there is a contract dispute regarding the lease of a commercial property, the exculpatory clause will usually be enforced.
If the property is residential, the exculpatory clause in the contract dispute will usually be considered unenforceable by the courts. This distinction is made because it is generally considered more detrimental to the public good to inflict harm against individuals than is harming a commercial enterprise.

What You Need to Know About Withdrawing Acceptance

An offer and acceptance is the analysis of a traditional approach in contract law that is used to determine whether an agreement is valid between two parties. The term “agreement” consists of an offer by a party or individual (known as the “offeror”) to another entity known as the “offeree.”

The two sides enter negotiations based on the contract and its explicit stipulations. When the two sides agree on the intricacies associated with the agreement, a contract becomes realized.

When an offeree accepts the stipulations of an agreement or a contract, they are held responsible for fulfilling the intended roles of their agreement. If the offeree withdraws acceptance, depending on the form of the agreement, they will be held liable to fulfill the underlying terms of the agreement. There are instances where the offeree will be able to terminate the agreement, but a violation or a reneged stipulation must be present in the agreement.

What You Didn’t Know About Restraining Trade

What You Didn't Know About Restraining Trade

Contract laws generally prohibit contracts that restrain trade. Contracts restraining trade are defined as contracts that reduce the level of competition involved in the commercial exchange of goods or services. Contracts that restrain trade are considered a classification of contracts that are contrary to public policy.
These kinds of contracts are sometimes defined by contract laws as covenants not to compete and sometimes as non-competition contracts. Whichever they are known as, though, they are illegal and are thus considered unenforceable. 
Elements of contracts that restrain trade are generally permissible if they are limited in scope or duration. A contract is permissible if it compels a party to the contract to relinquish the right to make a particular thing, but not if it attempts to force one of the parties to the contract to not compete with the other in any way in the future.
Contracts are permitted to contain non-competition clauses if the clause exists in order to protect business secrets of the employer, or if the non-competition element of the contract seeks to limit a former employee from utilizing business contacts which are considered essential to the operations of the company with which the original contract was signed.

The Truth Behind Fraudulent Misrepresentation

The Truth Behind Fraudulent Misrepresentation

Fraudulent misrepresentation may be claimed by a party attempting to have a contract declared void if three different criteria are met. The first is that there is an occurrence intended to create justifiable reliance on a fraudulent misrepresentation. 
The party seeking to have a contract invalidated must show that they entered into the contract due to a justifiable reliance on the other party’s fraudulent misrepresentation. Justifiable reliance only becomes an issue if the claim is not readily apparent to be false. Failure to investigate a claim may be used to support a claim of justifiable reliance. The material misrepresentation must be made about an area that the injured party had no way of proving and thus was forced to rely on the other party’s statement.

The Secret to Undue Influence

The Secret to Undue Influence

A contract can be challenged by one of the parties to the contract if they claim their assent was not genuine because they were subject to undue influence. Undue influence is said to exist if an inordinate amount of pressure is placed upon a party to enter into a contract against their best interests. Undue influence cannot be invoked by a party simply because they are in a detrimental contract. 
Undue influence is usually only claimed in the event that the party is in a relationship wherein another person is able to influence their decisions. Normally undue influence can only be successfully claimed by a minor or an elderly person who has a guardian responsible for overseeing their legal or financial obligations.
Other relationships in which undue influence may arise include attorney-client relationships, doctor-patient relationships, and the relationships between the beneficiaries of a trust and the individual responsible for managing the trust.
An occurrence of undue influence can be difficult to establish conclusively in court. There is sometimes an automatic presumption of undue influence by the courts. A presumption of undue influence can be established if the party in the superior position influenced the dependent party to agree to a contract that benefited the superior party.
If the dependent party challenges a party that they were influenced to create by their guardian, the courts are likely to issue a presumption of undue influence because they believe that if the contract did not arise due to undue influence, then the dependent would not be challenging the contract.
The guardian involved in a court case in which the genuineness of assent in a contractual dispute involves a presumption of undue influence often bears the responsibility of disproving the charge filed against them by their ward. The undue influence charge is often repudiated by presenting evidence that the ward inquired about the terms of the contract or was afforded the opportunity to consult with an independent party that did not have a direct stake in the contractual negotiations that are being challenged.
The guardian can disprove that there has been an occurrence of undue influence even if there was a benefit conveyed to the guardian if they can demonstrate that the ward received a full disclosure of the benefit that the guardian would derive from the contract. If the guardian can prove that full disclosure was presented to the ward, that the ward obtained independent analysis of the benefits that all involved parties would receive, then the presumption of undue influence can be disproven.
In the event that undue influence is found to have existed by the courts, the courts will declare the contract to be voidable by the ward. Undue influence, however, cannot be claimed by a ward that acted upon the innocent advice of their guardian yet was harmed by the contract in a way that did not benefit the guardian.

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