Posted: February 11th, 2022

Rescission Contract Law

Rescission Contract Law
Instructions:
Consider the following hypothetical: Ed contracted with Becky to build a house.
Immediately prior to that meeting, Becky was so nervous that she drank an entire bottle
of champagne and she does not remember all of the details of the meeting. Shortly
before the closing, Ed met with Becky, accused her of fraud and threated to prevent the
contract from going to closing. Ed’s associate, a former stunt double for Dwayne “the
Rock” Johnson, stood outside the door for two hours to prevent Becky from leaving. Ed
gave Becky the choice of signing a new contract promising him more money for the
build or going to court. Becky signed the agreement but now has sought legal advice.
• Imagine that you are Becky’s attorney. What would you tell her about whether
she can rescind the contract? (Big Hint: Capacity to Contract, Duress and Undue
Influence)
Requirements:
• Include one resource, in addition to the textbook.
o Use APA format for non-legal sources such as the textbook. Use
Bluebook citation format for any legal citations.
• Submit a Word document.
• Maximum two pages in length, excluding the Reference page.

In contract law, contracts are only enforceable if the parties arrived at closing in mutual agreement. Before signing a contract, a variety of terms need to be met in the spirit of mutual consideration. Valid contract signing process includes giving an offer, an acceptance of the offer by the receiving party, consideration. Johnson (2019) identifies that in the manifestation of an offer should be through elaborate communication should show the intent, is evidential and definite. For all parties, a proposal is the manifestation of the contractual purpose and should be thoroughly reviewed and elaborated on. As such, for a contract to be binding between parties, there should be an elaborate due process that is respectable by both parties. In the case of Becky, the initial contract signing identifies that she was drunk. As such she did not get to address the issue within the contract before signing it saw her misrepresent her interest. But this was not an intentional move or the outcome she sought as she had every reason to attend the meeting and sign the contract. A contract may be rescinded if the party is misrepresented, making it non-enforceable and void before the law (Johnson, 2019). But this is subject to proof that the misrepresentation was intentional and fraudulent. To which Becky did not intend to misrepresent or intentionally cheat Ed. Johnson (2019) identifies that fraud is a defense to non-enforcement of a contract, in which it is essential to prove that the other party did not read the agreement and intentionally or fraudulently signed the contract. She admits that she was nervous and drunk. This is negligence on her part, and she should have known better. Nonetheless, she was snot seeking to defraud Ed. Ed was legally obligated to cancel the contract and see to it that all the losses were paid in full by Becky. To the effect that she proves that she was not seeking to misrepresent herself and sign a contract without reading it. Ed should have rescinded the contract and sought an equitable remedy since, to his knowledge, he was a victim of misrepresentation.
Upon the first contract closure, Ed subjected Becky to his terms, which, as far as it goes, were fine by the law; to sign a new contract or go to court. But at the same time, he barred Becky from living using a “the Rock” double. Being under duress, Becky was forced to sign the contract and, as such, qualifies to void the second contract and rescind it as she was a victim of corrupt factors such as pressure and/ or unwarranted influence. She cannot seek to rescind the contract for mutual mistake of fact. This is because there are two separate contracts. Harvard Law Review identifies that if it were the same contract, this approach would have been pursued since both parties had wronged. Redmann (1933) identifies that in the case that both parties are faulty, courts can resolve the dispute based on error or fault of both parties’ conduct that was faulty. This can be done by seeking to compare either parties’ fault and proportionately assign cost. As such, it cannot be concluded that she intentionally misrepresented herself and her abilities to Ed. Alternatively, Becky could rescind the second contract citing undue influence and seek an equitable remedy. Concerning the first contract, Becky had no fraudulent intention to cheat Ed, but was nervous before their meeting and drunk to attend to the nervousness.

References
Johnson. (2019, December 13). Your Legal Rights When You Are Tricked into Signing a Contract. Retrieved from https://law.freeadvice.com/general_practice/contract_law/tricking-into-signing-contract.htm
Redmann. (1993). The Role of “Unilateral” Error in Contract Rescission, Construction, and Damage Valuation: A Modest Proposal David E. Redmann Jr. Louisiana Law Review, 53(6). Retrieved from https://digitalcommons.law.lsu.edu/cgi/viewcontent.cgi?article=5471&context=lalrev
Rescission of a Contract for a Mutual Mistake of Fact. (1922). Harvard Law Review, 35(6), 757.

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