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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.

Discover Contracts Contrary to Statute

Discover Contracts Contrary to Statute

There are several reasons the legality of a contract may be in question. The first is if the contract violates a statute. Contracts that are contrary to statute are considered void.
Usury contracts contrary to statute are formed when a contract exists that charges interest rates above the rate that State or local laws permit. Nearly every State has distinct usury laws. In some states a usurious loan is automatically void. In states that declare usury contracts void ab initio, the lender forfeits the principle as well as the interest if the courts become involved. 
Other states allow a usurer to recover both the principle loaned, as well as the interest up until the amount that would have been permitted under the law. In still other states, an usury contract only permits an individual to recoup the initial principle. Usurious rates depend upon the particular type of loan. If an usurious loan is not challenged, the person who has taken out the loan is usually obliged to repay the full amount.
Gambling contracts are void when they occur outside of the legally-approved methods of gambling. As with what level of interest constitutes usury in a particular State, each State has different ga

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.

Understanding Intent to Deceive

Understanding Intent to Deceive

In order for an allegation of fraudulent misrepresentation to be sustained there must be an intent to deceive on behalf of the accused party. The element of intent also requires that the deceiver must know that the information they are spreading is false or that the withholding of the information would constitute a fraudulent action.
The technical term for this intent to do wrong is known as scienter. Scienter is related etymologically to the word science. Both words refer to the possession of knowledge.
Laws concerned with fraud in contracts may find that scienter exists if one of the parties to the contract knows that one of the material facts that affect the contract in question is not true as they are stated in the contract.
Scienter is also determined by laws governing contracts to exist if one of the parties to the contract makes statements without any regard to whether the statements they utter are true or false. Laws regard this willful ignorance of the validity of the individual’s statements to rise to the level of fraudulent representation.
Scienter may also be found to exist if the party accused has claimed that their statements are based on personal knowledge or research when this knowledge or research has no actual basis in reality.

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.

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.
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