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    Law PPT 1

    Uploaded by

    Shruthi Bashetty

    Copyright:

    © All Rights Reserved
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    Law PPT 1

    Uploaded by

    Shruthi Bashetty
    3 views5 pages

    Copyright

    © © All Rights Reserved

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    PPTX, PDF, TXT or read online from Scribd

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    Copyright:

    © All Rights Reserved
    Download as PPTX, PDF, TXT or read online from Scribd
    Download as pptx, pdf, or txt
    3 views5 pages

    Law PPT 1

    Uploaded by

    Shruthi Bashetty

    Copyright:

    © All Rights Reserved
    Download as PPTX, PDF, TXT or read online from Scribd
    Download as pptx, pdf, or txt
    of 5

    FREE CONSENT

    By-
    Shruti Bashetty
    24011
    DEFINITION :
    Free consent in business law refers to the voluntary agreement of parties to enter
    into a contract without any coercion, undue influence, fraud, misrepresentation, or
    mistake.

    When two or more persons are said to be consent when they agree upon the same
    thing in the same sense.

    Consent is set to be free, when it is not caused by-

    1. Coersion
    2. Undue Influence
    3. Fraud
    4. Misrepresentation
    5. Mistake
    1. Coercion
     Definition: coercion refers to the use of force, threats, or intimidation to compel a party to enter
    into a contract or agreement against their will.
     Example: A business owner is threatened with physical harm by a competitor unless they agree to
    sell their business at a significantly undervalued price. The owner signs the contract out of fear,
    which means the consent was not free.
    2. Undue Influence
     Definition: Undue influence occurs when one party takes advantage of their relationship with
    another to unduly sway their decisions. This often happens in situations where one party has more
    power or authority over the other.
     Example: An elderly person may be persuaded by a caregiver to change their will, leaving all
    assets to the caregiver. The caregiver’s position of trust and authority creates undue influence,
    undermining the free consent of the elderly person.
    3. Fraud
     Definition: refers to intentional deception made for personal gain or to damage another party. It
    involves misrepresenting facts or lying to induce someone to enter into a contract or transaction..
     Example: A seller of a business claims that the company is profitable and provides falsified
    financial statements to support this claim. The buyer, relying on these fraudulent representations,
    agrees to purchase the business. Once the fraud is discovered, the buyer can void the contract.
    4. Misrepresentation
     Definition: Misrepresentation occurs when one party provides false information that induces
    another party to enter into a contract. Unlike fraud, misrepresentation can be innocent
    (unintentional) or fraudulent.
     Example: A car dealer tells a buyer that a used car has never been in an accident. The buyer,
    relying on this statement, purchases the car, only to find out later that it had significant prior
    damage. The dealer's false statement constitutes misrepresentation.
    5. Mistake
     Definition: A mistake refers to an incorrect belief about a fundamental fact at the time a contract is
    made. Mistakes can be mutual (both parties are mistaken) or unilateral (only one party is
    mistaken).
     Example: Two parties enter into a contract believing they are dealing with a specific piece of
    artwork that is an original. They later find out that the artwork is a replica. Since both parties were
    mistaken about a fundamental fact, the contract may be voidable.

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