Test Your Knowledge - Defenses to Contract Enforcement

Which case established that fraudulent misrepresentation requires proof of deceit?

Raffles v. Wichelhaus

Sherwood v. Walker

Crabtree v. Elizabeth Arden Sales Corp.

Derry v. Peek


What is mutual mistake in contract law?

A mistake made by both parties about a material fact.

An intentional misrepresentation of facts.

A clerical error made by one party.

A mistake made by one party about a material fact.


Which type of mistake can make a contract voidable if it significantly impacts the contract's basic assumptions?

Mutual mistake

Clerical mistake

Mathematical mistake

Unilateral mistake


What is a unilateral mistake in contract law?

An intentional misrepresentation of facts.

A mistake made by one party about a material fact.

A mistake made by both parties about a material fact.

A clerical error made by both parties.


What is procedural unconscionability?

Focuses on the process of contract formation and issues that create an unfair situation.

Focuses on the actual terms of the contract and their fairness.

Involves intentional deception to secure unfair gain.

Refers to mistakes made by both parties about a material fact.


Which of the following is not a type of duress?

Emotional duress

Legal duress

Economic duress

Physical duress


What is the remedy of rescission?

Modification of the contract to reflect true intent.

An order to perform the contract.

A requirement to pay damages.

Cancellation of the contract, returning parties to their pre-contractual positions.


What is the main purpose of the Statute of Frauds?

To prevent the formation of any contracts.

To enforce contracts regardless of form.

To allow verbal agreements to be legally binding.

To require certain contracts to be in writing to be enforceable.


What are the elements of fraud?

A material fact, mutual mistake, rescission, reformation, and restitution.

A false representation, clerical error, intent to induce, harm, and restitution.

A false representation, knowledge of falsity, intent to induce, justifiable reliance, and harm.

Mutual mistake, clerical error, rescission, intent to induce, and harm.


Under what conditions can a unilateral mistake provide grounds for rescinding a contract?

The mistake was due to a clerical error and the other party knew or should have known of the mistake.

The mistake was about a non-material fact.

The mistaken party was negligent.

Both parties were mistaken about a material fact.


What is undue influence?

Excessive pressure exerted by one party over another, particularly in a relationship of trust or confidence.

A clerical error made by one party.

Forcing one party into a contract under threat or harm.

A false statement of fact that induces another party to enter into a contract.


What can legal remedies for misrepresentation include?

Specific performance and damages.

Rescission and damages.

Arbitration and mediation.

Reformation and restitution.


What are the legal consequences of a mutual mistake?

There are no legal consequences.

The contract becomes voidable.

The contract becomes void automatically.

The mistaken party must pay damages.


What is substantive unconscionability?

Focuses on the actual terms of the contract and whether they are overly harsh or one-sided.

Focuses on the process of contract formation and the presence of hidden terms.

Involves intentional deception to secure unfair gain.

Refers to mistakes made by both parties about a material fact.


What is duress in the context of contract law?

A mistake made by both parties about a material fact.

A false statement of fact that induces another party to enter into a contract.

Forcing one party into a contract under threat or harm.

Excessive pressure exerted by one party over another.


What is misrepresentation in contract law?

A mistake made by both parties about a material fact.

A mistake made by one party about a material fact.

A false statement of fact that induces another party to enter into a contract.

An intentional act to nullify a contract.


What is the E-SIGN Act?

An act that provides that electronic signatures and records satisfy the Statute of Frauds requirements.

An act that states electronic signatures and records do not satisfy the Statute of Frauds requirements.

An act that invalidates all electronic contracts.

An act that requires all contracts to be handwritten.


What is fraudulent misrepresentation?

A false statement made knowingly or recklessly without belief in its truth.

A mistake made by both parties about a material fact.

A false statement made without intent to deceive.

A false statement made carelessly.


Which of the following contracts typically falls under the Statute of Frauds?

Contracts performed within a month.

Contracts for the sale of goods under $500.

Contracts for the sale of land.

Contracts to hire an employee for a week.


What is the remedy of restitution?

A requirement to pay future damages.

Modification of the contract to reflect true intent.

Returning the parties to their pre-contractual positions.

An order to perform the contract.