The Impact of Misrepresentation, Mistake, Duress and Undue Influence on the Validity of a Contract

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Introduction What is contract? Mike 2009 defines contract as ".... an agreement giving rise to obligations which are enforced or recognised by law. The factor which distinguishes contractual from other legal obligations is that they are based on the agreement of the contracting parties." (Mike, 2009). For a contract to be created, the following must ensue: • There must be two or more parties involved • There must be an offer (made by the offeror) • There must be acceptance (made by the offeree) • There must be consideration - the value that is exchanged between parties • There must be willingness and intention to create legal relations • All parties must be able to understand and be capable to be bound by the contract Contract can be formed between parties by verbal agreement, written or recorded agreement or through conduct (Pearson Education, Inc, 2010). Factors affecting validity of a contract There are vitiating factors which factors that can impact the validity of a contract and render it void, voidable or unenforceable. These factors are: • Misrepresentation • Mistake • Duress • Undue influence Misrepresentation During negotiations of a contract, there are oral or written statements made which may induce a party to enter into an agreement and be binding by a contract. If these statements are untrue, they are referred to as misrepresentation and the innocent party is allowed to take an action for misrepresentation. Misrepresentation can be defined as deceptive statements of facts which relate to existing fact of past events, that were presented by one party in order to lure the other into an agreement or binding contract (Sule, 2011). Features of misrepresentation i. Existence of statement of fact These are statements or materials which are presented by one party to convince the other into entering an agreement. The parties

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