 This is Weyland Chao and welcome to Contract Law Fundamentals Module 3a Part C. In this part we'll look at the enforceability of contracts which refers to specific contractual defects which may make a contract unenforceable or in other words void or voidable. The the defects that we'll look at are undue influence, duress, mistake, and misrepresentation. Let's now look at the enforceability of contracts. Even if all five of those essential elements of a contract are satisfied a contractual defect may make a contract either void or voidable. A defect may have occurred in the negotiation of the contract. Void means that no contract was ever created and voidable means a contract was created but may be canceled at the option of one of the parties. Let's now say Daria is Jamal's professor and Jamal trusts Daria's judgment. Daria asks Jamal, do you want to buy my Apple laptop for $500? And Jamal says, I don't know. Is this a good computer at a good price? And Daria says yes of course it is. You really need this to succeed at school. Jamal replies, okay since you think it's a good idea I'll buy it. Does Jamal have to buy Daria's laptop? The contractual defect of undue influence involves the abuse of a special relationship where a person used his or her position of power to obtain a contractual benefit from a weaker person. An example or examples of special relationships are parent-child, doctor-patient, caregiver, and informed patient, lawyer-client, trustee beneficiary, and teacher-student. So these are just examples. There can be other types of special relationships as well. Where there is undue influence in the creation of a contract, that undue influence can make the contract voidable at the option of the weaker party which means the weaker party has the option to cancel the contract. Does Jamal have to buy Daria's laptop? A teacher-student relationship or in this case more specifically a professor-student relationship could be considered to be a special relationship where the teacher exerts power over the student. Therefore Daria may be considered to have exerted undue influence over Jamal to enter into the contract to purchase the laptop. Therefore the contract can be voidable. Jamal may cancel the contract and not have to buy Daria's laptop. Let's change up the Daria and Jamal scenario just a bit once again. As before Daria is asking Jamal, do you want to buy my Apple laptop for $500? Jamal says no I don't need another computer. Then Daria says I really need the money. If you don't buy it perhaps your girlfriend would be interested in knowing about our affair. Jamal replies okay I'll buy your computer. Those Jamal have to buy Daria's laptop. Another type of contractual defect is duress. A contract entered into by a party that is under duress is voidable by that party. There are a few kinds of duress. There's duress of person which is a threat of harm to the party or a loved one including a threat of harm to reputation. There is duress of goods the threat to detain damage or destroy goods and also economic duress which is the threat of financial harm. So does Jamal have to buy Daria's laptop? Jamal was under duress of person when he entered into the contract due to Daria's threat to tell his girlfriend about their affair. You know therefore the contract is considered to be voidable and Jamal may exercise his option to cancel the contract. Okay let's change our story again. Daria as always asks Jamal do you want to buy my Apple laptop for $500? And Jamal simply says yeah sure I'll buy it. So a few days later Daria delivers to Jamal a ten year old Apple laptop she had stored at home. Jamal says that he thought he had agreed to buy the much newer Apple laptop that Daria was using when they formed the agreement. Does Jamal have to buy the ten year old laptop? Another type of contractual defect is a mistake. A mistake may render a contract to be void or voidable. What is a mistake? In negotiating a contract the parties may have made a mistake regarding a number of different things. It could be a mistake regarding the identity of one of the parties to the contract or a mistake regarding the subject matter of the contract or the existence of the subject matter of the contract or even a mistake as to what exactly was being signed when the agreement was entered into. So back to our question. Does Jamal have to buy the outdated ten year old laptop? The answer is no. The contract is void due to mistake. Jamal and Daria made a mistake regarding the meaning of my Apple laptop. Therefore there was a mistake regarding the particular laptop being sold. In other words there was a mistake regarding the subject matter of the contract. Alright let's tweak our Daria and Jamal story again. Daria as before asks Jamal do you want to buy my Apple laptop for $500? And Jamal says maybe. Does it have the latest Mac OS? Daria says yes it does. And Jamal replies okay I'll take it. But it turns out that the laptop had an older version of the Mac operating system. Daria did honestly believe that her computer had the latest version. So does Jamal have to buy Daria's laptop? The last contractual defect we'll look at is misrepresentation. A misrepresentation occurs where one party makes a false or misleading statement that can be reasonably expected to influence the decision of the other party to enter the contract. A misrepresentation makes the contract voidable at the auction of the innocent party. Does Jamal have to buy Daria's laptop? The answer is no. The contract is voidable due to misrepresentation. Daria made a false statement regarding the operating system. Since Jamal was asking specifically about the laptop's operating system Daria's false statement can be reasonably expected to influence Jamal's decision to buy the laptop. Therefore the contract is voidable on the basis of misrepresentation and Jamal has the option to cancel the contract.