Bars to a Contract: How to Know When It’s “No Deal”

When is a contract not a contract? Don’t abandon hope if you’re having trouble with you were stuck with. The law may provide a contract defense that could prevent a legally enforceable contract from being formed.

Your lawyer can examine your particular situation and advise you. Here’s a quick look someday work in your favor. We’ll look at some others in a later article.

Fraud. A contract can be canceled by a court because of fraud. Fraud is when the misrepresentation that you reasonably relied on and that disadvantaged you. A material misrepresentation is an untrue fact that is affect the terms you’d agree to if you knew the truth. In many states, this misrepresentation doesn’t have to be made on purpose to make the contract voidable.

Say a friend offered to sell her old Edsel to you. Suppose she knew it had no usual purpose of driving it. She told you it was working fine, and you relied on her statement. Then the contract you made may be set aside on the grounds of fraud.

Here, there is no issue of the statement being merely the seller’s opinion, or exaggerated not to believe literally. She didn’t just say it was a great car when really it was a mediocre car. Saying it’s “great” is merely an or a substantial failure to state a material fact about an important part of the contract. For that reason ?? and because dishonest people and puffing ?? actual fraud that will invalidate a contract is a lot less common than people think.

Duress. A contract that someone agrees to under duress is void. Duress is a threat or act that overcomes someone’s free will.

Duress is more than persuasion or hard selling. Persuasion in bargaining is perfectly your friend, “I would never pay that much for that old Edsel of yours if I had a choice.” You do have a choice: buy a nice Taurus coercion, such as a threat of violence or imprisonment.

It may also be duress to threaten to abuse the court system to coerce your agreement, i.e., years.” There is also economic duress. This isn’t the same as “driving a hard bargain.” The classic case is where the supplier of a short notice and at a critical time, not to deliver it ?? in violation of an existing contract ?? unless he or she gets more contracts made under such economic duress.

Your lawyer can tell you how to protect yourself, helping you determine whether you rights you might have besides disavowing the contract. With duress, it’s important to act quickly, since the courts are especially the danger has passed.

Undue Influence. There are other uses of unfair pressure, less severe than duress, that void a contract. One contract defense is involve a threat. Rather, it’s the unfair use of a relationship of trust to pressure someone into an unbalanced contract. Undue influence at a disadvantage, perhaps due to illness, age, or emotional vulnerability. The other person often has some duty to look out for the weaker one’s interests.

An example would be an adult child who “persuades” his elderly, failing mother to sell a pittance. The because of undue influence.