Remedy Of Rescission Research Articles

On and Off Contract Remedies Inducing Cooperative Investments

A party dissatisfied with the contractual performance of a counterparty is typically able to pursue a variety of legal recourses. Within this apparent variety are two fundamental alternatives. The aggrieved party may (i) ‘affirm’ the contract and seek money damages or specific performance, or (ii) ‘disaffirm’ the contract with the remedy of rescission and seek restitution. This simple dichotomy of contract remedies applies broadly in both common law and civil law practice. We show here that this remedial regime allows parties to write simple contracts that induce first-best cooperative investments.

On and Off Contract Remedies Inducing Cooperative Investments

A party dissatisfied with the contractual performance of a counterparty is typically able to pursue a variety of legal recourses. Within this apparent variety lurk two fundamental alternatives. The aggrieved party may (i) “affirm” the contract and seek money damages or specific performance; or (ii) “disaffirm” the contract with the remedy of rescission and restitution. This simple dichotomy of contract remedies applies broadly in both common law and civil law practice. We show here that this remedial regime allows parties to write simple contracts that induce first-best cooperative investments.

Remedies for misrepresentation in applications in the presence of fraudulent intent

Many contracts are based upon information provided in written applications, including insurance and employment contracts. However, the remedies used in these two contexts for material misrepresentation in the application differ. Insurers use the remedy of rescission and restitution, which returns the parties to status quo ante. Employers simply terminate the contract, leaving the parties where they are at the time of termination. This paper examines the role played by each remedy in the context of intentional misrepresentation. It is shown that rescission and restitution expands the situations in which mutually beneficial contracting will occur. It is also shown that insurers can offer lower premiums when the remedy of rescission and restitution is available.

Insider Trading in Israel and England, Part II

It is submitted that even if the hapless outsider cannot bring an action for damages because of the existing state of the law regarding fiduciary duties and breach of statutory duties, he still has an equitable remedy of rescission of the contract based on quasi-contractual principles. The crime of fraud, under secs. 13 and 54, respectively, would be made the basis of setting the contract (of sale or purchase) aside. To support this proposition we shall explore the quasi-contractual principles which enable one contracting party, the victim of a crime committed by the other party in entering the contract, to defeat this contract.In Browning v. Morris, in an oft-quoted statement by Lord Mansfield, the following principle was declared: But, where contracts or transactions are prohibited by positive statutes, for protecting one set of men from another set of men; the one, from their situation and condition, being liable to be oppressed or imposed upon by the other; there, the parties are not in pan delicto; and in furtherance of these statutes, the person injured, after the transaction is finished and completed, may bring an action and defeat the contract.