Part I

Review

Defenses to Formation

Nathonas checklist (SAMI DI FUMA?)

Statute of Frauds

We went over last term

Illegality

Crimes, torts, gambling, obstruct justice, etc.

• void if at time of offer
• revoked if between offer and acceptance
• discharged if after contract formed

Discuss finer points of illegality in barbri

Incapacity

Infancy

Generally under age of majority. Voidable by infant, but binding on adult.

• disaffirmance or affirmance at age of majority
  • exceptions

Mental Incapacity

Intoxication

Revisit Lucy v. Zehmer

Duress

• Physical force (void)
• Immediate threat, no reasonable alternative (voidable)
• Economic, generally not a defence
  • exception

Ambiguity

When language has at least two possible meanings

• Both parties unaware = no contract
  • Raffles v. Wichelhaus
• Both parties aware = no contract unless they intended the same meaning
• One party aware = contract according to intent of unaware party

Subjective intent of parties

• latent v. patent

Part II

Mistake

• Mutual
• Unilateral

Mutual Mistake

Where both parties are mistaken about existing present facts that are a basic assumption of the contract, the mistake is material, and the party asserting the defense did not assume the risk.

• Discussion of bearing the risk
• Discussion on mistake in value
• Discussion of mistake in transmission

Unilateral Mistake

Unilateral mistake generally does not prevent formation unless the nonmistaken party knew or had reason to know of the mistake.

• Sometimes relief in equity

Fraud/Misrepresentation

Fraudulent Misrepresentation

Where a party misrepresents material facts with intent to deceive, and the innocent party reasonably relies on the misrepresentation. The contract is voidable.

Misrepresentation

Where a party misrepresents material facts, the innocent party reasonably relies on the misrepresentation, and the innocent party would not have entered the contract but for the misrepresentation. The contract is voidable.

Unconscionability

Terms that so unfair and one sided, usually because of unequal bargaining power, that the court will refuse to enforce the term of the entire contract.

• confession of judgement
• disclaimer of warranty
• add-on clauses (rent to buy case example)

Adhesion Contract

A form of unconscionability where a buyer is in a position where they can only take it or leave it. Courts only find this where a buyer cannot get a necessity from any seller without agreeing to the same terms.

Undue Influence

Considered a form of duress, undue influence occurs when a susceptible party is subject to excessive pressure by another party that they have a confidential relationship with (e.g. attorney, adult children taking care of elderly, etc

Part III

Strategies, Cases, then Questions and Answers.

Approaching Defenses

Treat formation as a prima facie complaint filed by the plaintiff.

Treat defenses like a respondent would in their answer.

Think through what each party is trying to achieve.

Short Forming

A strategy for race-horse essays only

• fact pattern must say valid contract or valid written contract
• be sure to cover the basics of formation
• when in doubt write long form

Raise and Dismiss

A strategy for when you spot an issue that is collateral, but not immaterial, to the actual facts in the essay, or when you're convinced it doesn't apply.

• write a heading, short rule, and why your doing no more to address it.

Example: You see facts for ordinary economic duress. Don't skip it, spot it, put the rule and say generally courts won't find it.

Hedging

A strategy for when you see two alternatives, and can't decide which. Write both alternatives and say if the court finds this, then…, if the court finds the other alternative, then… For certain issues you might need to hedge throughout the essay we more than one dependent issue.

An example would be if you decide for certain one party is not a merchant, but the rest of the facts raise merchant issues.

Another example is if you see something you think is a showstopper (e.g. no offer, valid defense, etc.) You would write that you think it breaks things, but the say, for example, "however if the court finds there was an offer, then…" and keep writing the essay.

Argue both sides

Only do this if there's something that would be in dispute based on the facts. You don't need to (and shouldn't) argue both sides for issues that aren't in contention between the parties.

How would each party want a finder of fact to see the facts from their perspective?

Our cases this week

Pettit v. Liston

Ortelere v. Teachers’ Retirement Board

Cousineau v. Walker

Bentley v. Slavik

@peoplescollolaw