Legal-Ease: Can I get out of this deal?


LEGAL-EASE

By Lee R. Schroeder - Guest Columnist



Lee R. Schroeder


Sometimes, circumstances change. Other times, we change our minds on what we want. And at still other times, we find a better deal as to price or quality. Situations like these lead to an inevitable question: Can I “get out of” some deal or contract so I get into the new deal or contract?

Analyzing whether someone can enforce or terminate a contract primarily includes considering four principles.

First, if a person signs a contract, the signer is most likely bound to all terms of the contract. The law presumes that the signer of a contract read the contract, understands the contract and will honor the contract, even if the signer failed to read or understand. The argument “I didn’t know what I was signing” usually will not terminate a contract.

Second, if a contract is required to be in writing (like certain real estate contracts), the fact that an agreement was not written can increase the possibility that the contract can be terminated.

Third, if money has exchanged hands or if one person reasonably and understandably relied on the contract, the contract is more likely to be enforced.

For example, I might agree with my neighbor to purchase his pickup truck. Later that day, my neighbor buys himself a new pickup truck. In that case, I am bound by the agreement to buy my neighbor’s truck because my neighbor reasonably and understandably relied (took steps in reliance) upon what I agreed to do.

Fourth, a contract is generally not void just because the contract is later understood to be very one-sided or simply a bad deal. However, if a contract is really, really one-sided and one of the parties to the contract had literally no meaningful choice, that contract could potentially be voided or changed later.

Presume we are on day two of what The Lima News forecasts to be a 14-day, 20-feet-of-snow blizzard. An out-of-towner shows up at the door of your rural house after that person’s car broke down. You agree to let the traveler stay at your house in exchange for the deed to the traveler’s own house and $150,000 cash.

After the blizzard, the traveler may be able to get out of the contract and avoid turning over his own home and $150,000. The traveler would still owe you money, but a judge may force the terms of the contract to change in light of the traveler not having any meaningful choice (without agreeing, the traveler would have literally died) and because of the huge money conditions.

Similarly, a groom may find his bride two hours before their wedding and present to his bride, for the first time, a prenuptial agreement for her to sign. And, the groom says with no pre-nuptial agreement, there will be no wedding. Although the bride would not die if she failed to sign the pre-nuptial contract, the overwhelming humiliation might satisfy the requirement that she had no meaningful choice, especially if the pre-nuptial agreement was grossly one-sided in favor of the groom.

Lee R. Schroeder
http://www.limaohio.com/wp-content/uploads/sites/54/2017/10/web1_Schroeder-Lee-RGB.jpgLee R. Schroeder
LEGAL-EASE

By Lee R. Schroeder

Guest Columnist

Lee R. Schroeder is an Ohio licensed attorney at Schroeder Law LLC in Putnam County. He limits his practice to business, real estate, estate planning and agriculture issues in northwest Ohio. He can be reached at Lee@LeeSchroeder.com or at 419-659-2058. This article is not intended to serve as legal advice, and specific advice should be sought from the licensed attorney of your choice based upon the specific facts and circumstances that you face.

Lee R. Schroeder is an Ohio licensed attorney at Schroeder Law LLC in Putnam County. He limits his practice to business, real estate, estate planning and agriculture issues in northwest Ohio. He can be reached at Lee@LeeSchroeder.com or at 419-659-2058. This article is not intended to serve as legal advice, and specific advice should be sought from the licensed attorney of your choice based upon the specific facts and circumstances that you face.

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