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Business and consumer claims

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Define and describe intentional misrepresentation (fraud), including in your answer fraud in the inception, fraud in the inducement and fraud by concealment (or silence).

Based on the legal context, misrepresentation is a declaration or demonstration by means of expressions or by behavior, which is not concurrence in the truth or facts. Misrepresentation is a variation of fraud, another term used to describe a false depiction of factual matters that mislead and to deceive on purpose another person or group of person to use in his/her advantage.  Intentional misrepresentation is the correspondent of an individual deliberately creating a falsify assertion hoping and intending another person to rely on that statement that cause harm on that another person. (“Business and consumer claims”)

When a person is aware of what he/she is signing but another person induced the consent, fraud in the inducement comes in. Fraud in the inception is also known as fraud in the factum or execution. Moreover, a fraud in the inducement occurs when a party who is unwilling to go through an agreement is mislead, by means of the act of fraud of another person, about the true nature of the document he/she has authorized. (Cheeseman, 2006)

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On the other hand, fraud in the inducement is a personal defense and is described as a fraud that triggers a person to implement and go through the contract such as giving someone the wrong impression about the real information. Meanwhile, fraud by concealment is described when certain party suppresses a factual material to another party. The contracts made with the implementation of the kinds of fraud above are considered invalid. (“Genuineness of Assent: Lecture Notes”)

Compare and contrast intentional misrepresentation with innocent misrepresentation.

Intentional and innocent misrepresentation is both an allegation and demonstration of something that is not in conformity with the truth or a misrepresentation.

Intentional misrepresentation, as stated above, is a representation set up in order to deceive and give out false knowledge. However, innocent misrepresentation as the word implies happens when the misrepresentation is not an act of fraud or is not intended to trick or deceive. A party who believes in his/her false account as true had a sensible and rational argument and justification for doing so. 

Read about negotiable and nonnegotiable instruments

Explain the Statute of Frauds and list those contracts to which it applies.

Statute of Frauds is a representation subsequent to an old English bylaw. The Statute of Frauds is adopted by the United States and set as a form of state law compelling definite manner of writing contract. This proposal is utilized as a defense in a breach of contract lawsuit with the objective of avoiding the opportunity of an imaginary contract with an act of fraud between two participants.

Once a defendant appealed to the statute of fraud in a breach of contract, he/she is supposed to determine that his action of not carrying out what is stated in the contract is legally not implemented due to unsatisfied prerequisite of the statute, then that particular defendant is not accountable for its breach.

There are only certain types of contracts in which the Statute of Fraud is applicable. Based on the old English law, these contracts includes contracts in contemplation of marriage, contracts that is unable to perform within a year, contracts of the interest for the sale of land, contracts by the executor of a motivation that the debt of the estate is paid with his own money, contracts for the sale of goods above a certain value, contracts between two party (one party serving as a guarantor for the debt and obligation of the other).

Explain and apply the parol evidence rule

The parol evidence rule is a complicated set of rules of contract law that determines whether certain claims of one party such as some missing part of the agreement or contract should be heard. This missing part can be under the rule if a written or oral communication is made prior or contemporaneous to the implementation of the written contract. This implies that confirmation of a later statement is already excluded within the scope of the parol evidence rule.

Applying the concept of the parol evidence rule, for instance, two parties, Person A and Person B, had an agreement of merging into a business wherein the two would shoulder and manage the business in equal parts. With that, Person A and Person B come up with a written contract, which contains all the terms that the two had agreed upon. However, sooner Person A did realize that it is not stated in the contract the proportionality of their share in business income.

Suppose that Person B is more actively participating in administrating the business due to having more experience in their venture, causing Person A some concerns about the real situation of the business. Presumably, Person A and Person B could cordially resolve the issue. Yet, in the case of litigation became a necessity, the question now is whether Person A would be allowed to claim that both had orally agreed that they will get 50% each of the business income by means of testifying before the trier of the fact.

On the other hand, if the two persons had written “50% each in the business income” in a scratch paper during the time that they are just building their plans about the partnership, would Person A be allowed to present the scratch paper as a proof? Either of the two claims, the oral agreement and the scratch paper would be parol evidences. The application of the parol evidence rules determines whether or not the trier of fact would hear such evidence.

Describe assignment of contracts and what contract rights are assignable.

Assignment of rights under a contract is the absolute assigning of the rights to obtain the benefits accumulating to one of the contract parties. Such assignments may either be donative in nature (that is basically presenting as a gift), or as an exchanged for consideration. In spite of that, Assignment of Rights under contract only transmits the privileges/benefits to the new proprietor, yet the responsibilities stay behind with the preceding owner. Considerably, all contract rights are assignable, if not these rights fall within some of few exceptions. Those rights that cannot be assigned are the personal service contracts, assignment of future rights, contracts where assignment would modify the risk and assignment of legal measures concerning personal rights.

Define intended beneficiary and incidental beneficiary, compare and contrast the two.

Intended beneficiary is created when one party, known as the promisee, constructs a concurrence to present some contemplation to the other party, called the promisor, in return for the promisor’s promise to give some product, service, or support to the third party beneficiary identified in the contract. Furthermore, if the contract is breached, the promisee can prosecute the promisor.

On the other hand, incidental beneficiary is a party who position to the advantage from the implementation of the contract, even though that was not the objective of whichever contracting participant.

Both beneficiaries gave rise to a third party, person/s who is/are distinguished as having imposable privileges formed in them by a contract to which they are not parties and for which they bestow no substance.

Define and distinguish between conditions precedent, conditions subsequent, and concurrent conditions.

A condition is defined as an indecisive situation upon the occurrence, of which specific rights or obligations will be broadened, produced or damaged. In the context of the law of contracts, there exist the conditions precedent and subsequent.

Condition precedent has to come about previous to the accrual of rights. A party is required to fulfill the contractual obligation before another party. Meanwhile, the condition subsequent pertains to an event in which the occurrence or non-occurrence consequentially discharges the performance under a contract. Nonetheless, if the two parties under the contract are mandatory to provide the performance all together, there takes place the concurrent condition.

Define and apply the doctrine of commercial impracticability.

Commercial impracticability is defined as the exemption of not following the contract due to a tremendous or unanticipated occurrence, or deprivation, which give rise in impractical performance of the contract of the promisor. The law doctrine of commercial impracticability may justify the performance and applies where an unexpected incident creates performance irrationally more complicated or expensive, devoid of the party’s liability.

Explain how contracts are discharged by operation of law.

Under some circumstances, contracts can be discharged by the operation of law. These includes the statute of limitations, an interlude of time contained by which a legal action is brought to impose a contract or incessantly demise the right to perform, discharge of debtor’s unpaid debts and any other legal responsibility in bankruptcy, and the intentional alteration of the contract that may lead to cancellation of the contract by the innocent party or enforcement under the initial or modified conditions.

Describe compensatory, consequential, nominal, and punitive damages.

Damage, in the context of law, is the award given to the party as compensation for the loss or injury caused by another party. Damages have three classes comprising compensatory, nominal and punitive damages.

Compensatory damages are projected to re-establish what a petitioner has gone as a consequence of a defendant’s unlawful behavior. Meanwhile, consequential damages are variations of compensatory damages and are given to situation where the failure experienced by a petitioner is not exactly or instantly by the illegal demeanor of a defendant, but as a replacement for results from the defendant undertaking. Also, consequential damages are unforeseen damages that come up from circumstances outside the contract. Nominal damage, on the other hand, encompasses of a diminutive amount granted to petitioner who has endured no considerable failure or damage yet has nevertheless experienced an assault of rights.

The damages are bestowed when the non-breaching group prosecutes the breaching party even supposing no monetary damage has resulted from the violation.   Punitive damage, then, is presented not to pay compensation a plaintiff for the damage experienced by the compliant but to reprimand a defendant for predominantly wicked and unlawful manner. Punitive damages are established standard of general law in the United States and a substance of state law. In numerous territories, this damage is resolved on statute and often for the purpose of compensation. It is only awarded in exceptional cases and not in the purpose of resolving contract disagreements.

Define and explain complete performance, inferior performance, and material breach of contracts.

The majority contractual rights are discharged using the complete performance, an unrestricted and complete proposition or the tender of performance by a contracting party to execute his or her commitments under a contract, in which releases also the responsibility of the party.

Inferior performance also known as the material breach has an authorized significance of the non-breaching party that may either withdraw the contract and recuperate the compensation, or establish the agreement and make progress to the damages. Material breach is a violation that comes about when a party provides an inferior performance of his or her contractual obligations. Furthermore, the inferior performance is not always the same and is resoluted in a case-by-case basis.


Business and consumer claims. 2006. [Online Version]. Retrieved May 5, 2007 from

Cheeseman, H. (2006). Contemporary Business and Online Commerce Law. 5th ed. [Online Version] Retrieved May 5, 2007 from

Contracts-Third Party Rights: An excerpt from West Bus Law [Online Version] from

Genuineness of Assent: Lecture Notes [Online Version] Retrieved May 5, 2007 from

Law Encyclopedia. “Statute of Fraud”. [Online Version]. Retrieved May 5, 2007 from

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