Most Tested Contracts Areas on FL Bar Exam: Part Two

Florida Contracts appears broad, but the Florida Bar Exam tests a narrow, predictable set of issues. A review of past essays shows the same pattern: the examiners focus on Florida-specific rules and the defenses that determine whether an agreement is enforceable at all.

This article is Part Two of a six-part Ameribrights series covering the most consistently tested Florida Contracts topics:

• Contract Formation (Part One)

   

• Defenses to Enforcement (Part Two)

   

• Statute of Frauds

   

• Contract Interpretation

   

• Performance & Breach

   

• Remedies

Each part includes clear Florida rules, high-yield distinctions from common law and the UCC/MBE, and Florida Bar Essay Samples modeled on released FBBE essays — so you can immediately see how these rules function under exam conditions.

Part Two focuses on the defenses that most often appear in Florida Contracts essays:
duress and economic duress, fraud and concealment, public-policy limits (including exculpatory clauses and gambling), unconscionability, mistake, and incapacity.

These defenses frequently determine whether a contract exists or can be enforced at all, and Florida applies several rules that differ from general common law. This section breaks down each defense in a simple Q&A format with Florida-specific distinctions to help you write precise, high-scoring answers on exam day.

What is Florida’s rule on duress and economic duress?

Florida recognizes duress as a defense when a party’s apparent consent was not truly voluntary. The Florida standard is strict, and examiners consistently test whether pressure crosses the line from “hard bargaining” into “wrongful coercion.”

Florida Rule on Duress 

Duress is a condition of mind produced by an improper external pressure or influence that practically destroys the free agency of a party and causes him to do an act or make a contract not of his own volition. Francavilla v. Francavilla, 969 So.2d 522, 524–25 (Fla. 4th DCA 2007)

A contract is voidable for duress when:

1) The act was done involuntarily — not as a free choice or exercise of free will; and

2) The involuntary action was caused by improper, coercive, or wrongful pressure by the other party.

Subjective fear alone is not enough. Florida uses an objective standard. City of Miami v. Kory, 394 So.2d 494 (Fla. App. 1981)

High-Yield Examples (What Florida Courts Have Found to Be Duress)

• Threats of physical harm or unlawful conduct,

• Threats to wrongfully withhold payments already owed, and 

• Threats to breach without justification when the other party has no realistic alternative

Hard bargaining, taking advantage of market conditions, a party’s financial difficulty (by itself), and threats to take lawful action are not considered duress in Florida. 

Florida Rule on Economic Duress

Florida recognizes economic duress (“business compulsion”), but applies it narrowly.

A contract is voidable for economic duress only if:

• The defendant engaged in wrongful or coercive acts,
• The plaintiff had no reasonable alternative, and
• The defendant’s wrongful acts caused the financial pressure.

Common Bar Exam Patterns

• “Pay more or I walk” construction scenario

If the threat is to breach without justification, and the owner has no time to find another builder, economic duress is strong.

• Settlement agreements signed under pressure

Not duress unless the threat was unlawful or the party had no alternative but to sign.

• Last-minute refusal to perform unless terms shift

If the victim has no meaningful way to cover, this can be economic duress.

• Pressure created by market forces

Not duress. Florida requires wrongful conduct, not market conditions.

Florida Sample Essay

Contractor (C) agreed to renovate Homeowner’s (H) roof for $18,000. Halfway through the job, C discovered that he had underestimated labor costs. With the roof partially open and a storm forecast for the next day, C told H:

“If you don’t sign this revised contract for $28,000 right now, I’m walking off the job.”

H knew no other roofer could take over before the storm and that an unfinished roof would cause major damage. Feeling she had no real choice, H signed. After the project was completed, H refused to pay the increased amount, claiming the modification was obtained through duress. C sues to recover the extra $10,000.

Issue 1: Duress under Florida law
A contract is voidable if a party’s assent is induced by a wrongful threat that overcomes the person’s free will and leaves no reasonable alternative.

Here, C threatened to stop work immediately unless H agreed to a $10,000 increase. C had no legal right to withhold performance because he had already agreed to the $18,000 contract. Threatening breach of an existing duty—knowing the other party is vulnerable—is a wrongful threat under Florida duress law.

Issue 2: Economic duress in Florida
Florida recognizes economic duress only when:

1. The financial pressure was created or wrongfully exploited by the other party, and
2. The victim had no reasonable alternative.

H faced a severe time-sensitive risk: an open roof with a storm approaching. No reasonable substitute roofer was available on such short notice. C leveraged this vulnerability—one he created by threatening breach—to coerce the modification.

Thus, the combination of wrongful threat and no reasonable alternative meets Florida’s narrow standard for economic duress.

Issue 3: Enforceability of the modification
Because the contract modification was obtained through duress, it is voidable at H’s election. H may affirm the original $18,000 agreement and refuse to pay the coerced increase.

Conclusion: Under Florida’s duress and economic-duress rules, C’s threat to walk off the job created wrongful pressure that destroyed H’s free choice. The modification is voidable, and C cannot recover the additional $10,000.

Bottom Line (Duress + Economic Duress)

• Duress requires a wrongful threat that destroys free will.
• Economic duress is recognized but applied narrowly.
• Hard bargaining ≠ duress unless the pressure is wrongful and leaves no reasonable alternatives.
• Florida consistently focuses on:
  wrongful act → no alternative → coerced consent.

How does Florida treat fraud, misrepresentation, and concealment? 

Fraud and Fraud in the Inducement (Same Test)

Florida uses the same four-element test for fraud and fraud in the inducement. A party must show:

• A false statement of material fact;
• Knowledge of falsity (or reckless disregard);
• Intent to induce reliance; and
• Actual, reasonable reliance causing injury.

Huffstetler v. Our Home Life Ins. Co., 67 Fla. 324, 65 So. 1 (1914); Johnson v. Davis, 480 So. 2d 625 (Fla. 1985)

A material fact is one that would affect a reasonable person’s decision to enter the contract. Puffery, opinions, predictions, and sales talk are not actionable. A successful fraud claim makes the contract voidable at the injured party’s option.

Florida then applies this same test in two main ways:

• Fraud in the inducement
  
  • Lies or half-truths before or at formation that cause someone to enter the contract.
  • Classic bar pattern: seller lies about condition, value, or prior problems with the thing being sold.

     

• Fraud (general common-law fraud)
  
  • Same elements, but not limited to formation.
  • Can occur during performance or later, and can support both rescission and, in extreme cases, punitive damages.

Nessim v. DeLoache, 384 So.2d 1341 (Fla. 3d DCA 1980).

Importantly, a merger/integration clause does not bar a Florida fraud claim based on pre-contract misrepresentations.

Fraudulent Concealment 

It requires that: 

• The defendant knew a material fact,
• The defendant concealed it,
• The defendant had a duty to disclose,
• Plaintiff relied on the resulting false impression, and 
• Plaintiff suffered damages.

Johnson v. Davis, 480 So. 2d 625 (Fla. 1985)

When Does Florida Impose a Duty to Disclose? 

The duty to disclose arises when one party has information that the other party has a right to know because of a fiduciary or other relation of trust or confidence between them. Florida imposes a duty to disclose material facts in three predictable situations:

Residential Real Estate Transactions (Major Florida Rule!)

Under Johnson v. Davis, sellers must disclose known, latent defects that materially affect the property value and are not readily observable. This duty is equally applicable to all forms of real property, new and used.

• This is a huge Florida distinction
• Frequently tested
• Applies even if the buyer never asks

Fiduciary or Confidential Relationships

A duty to disclose exists when:

• one party places trust/confidence in the other,
• one party has superior knowledge and knows the other is relying on them,
• or the parties are in a recognized fiduciary relationship.

Ex: business partners, attorney–client, trustee–beneficiary.

Half-Truths or Partial Statements

If a party speaks at all, Florida requires the full, accurate version.

Half-truths = actionable fraud.

Misrepresentation (Negligent and Innocent) 

Florida recognizes negligent misrepresentation if:

• The speaker supplies false information for the guidance of others,
• fails to exercise reasonable care,
• and the recipient reasonably relies on it.

This is fault-based, not intent-based.

Florida allows rescission for an innocent but material misrepresentation — even if made in good faith. This means an innocent, material misrepresentation makes the contract voidable by the misled party, even without fraudulent intent. 

Florida Essay Sample (Misrepresentation) 

Seller (S) listed a used boat for sale online, stating it was “in excellent mechanical condition.” Buyer (B) inspected the boat briefly but did not look at the engine compartment because S kept saying, “Don’t worry, everything under there is perfect.”

Unknown to B, the engine had a long-standing oil-pressure defect that S knew about. Two weeks before listing the boat, a mechanic told S the engine “could fail at any moment unless repaired.” Instead of repairing it, S cleaned the area to hide oil residue.

Before purchase, B asked S: “Has the boat ever had any major engine problems?” S replied: “No, nothing at all.” B purchased the boat for $24,000.

Three days after closing, the engine failed. A second mechanic told B the defect was obvious to anyone familiar with marine engines and that residue had clearly been wiped away.

B sues S seeking rescission and damages based on (1) fraud in the inducement; (2) fraudulent misrepresentation; and (3) fraudulent concealment.

Issue 1 — Fraud in the Inducement

Rule: In Florida, fraud in the inducement requires:

1. A false statement of material fact;
2. Knowledge of falsity;
3. Intent to induce reliance;
4. Justifiable reliance; and
5. Damages.

Application: S stated the boat was in “excellent mechanical condition” and denied “major engine problems.” Both statements were factual assertions, not opinions, because S had superior knowledge and the condition was verifiable.
S knew the engine had a serious defect and intentionally minimized the issue to induce the sale.
B relied on these statements in deciding to purchase the boat for $24,000.

Conclusion: All elements are met. B can rescind the contract and seek damages for fraud in the inducement.

Issue 2 — Fraudulent Misrepresentation

Rule: A fraudulent misrepresentation in Florida requires a material false statement made knowingly or recklessly, intended to induce reliance, resulting in actual and reasonable reliance.

Application: S’s denial of engine problems was false and knowingly made. The problem was material because engine condition goes to value and safety.
B reasonably relied—S repeatedly reassured him and prevented deeper inspection.

Conclusion: B prevails on fraudulent misrepresentation.

Issue 3 — Fraudulent Concealment

Rule: Florida recognizes fraudulent concealment when:

1. The defendant knows a material fact;
2. Has a duty to disclose;
3. Intentionally conceals or suppresses the fact;
4. Causing the other party to enter the contract in ignorance of the truth.

Duty to disclose arises when:

• a party has superior knowledge and knows the other is acting under a mistaken belief;
• the fact is not discoverable by reasonable inspection; or
• the seller actively prevents investigation.

Application: S had actual knowledge of the defect.
S repeatedly told B not to inspect the engine area and cleaned the oil residue to hide evidence. This created a duty to disclose because S:

• had superior knowledge,
• knew B was relying on S’s assurances, and
• actively prevented meaningful inspection.

The defect was material and not discoverable because S concealed it.

Conclusion: B also prevails on fraudulent concealment.

Overall Conclusion

S engaged in intentional misrepresentation and concealment.
B is entitled to rescission of the contract and damages under any of the theories: fraud in the inducement, fraudulent misrepresentation, and fraudulent concealment.

Bottom Line

Florida treats fraud broadly and aggressively: any material lie, half-truth, or intentional hiding of important facts makes a contract voidable by the misled party. Fraud in the inducement requires a knowingly false statement that causes reliance; fraudulent concealment applies when a party with superior knowledge hides or suppresses a material fact; and even an innocent but material misrepresentation allows rescission. If the deception affected the decision to contract, Florida courts typically give the harmed party the right to unwind the deal and pursue damages.

What are Florida’s public-policy limits (exculpatory clauses + gambling)?

When does Florida refuse to enforce exculpatory clauses?

An exculpatory clause is a contract provision where one party agrees to release the other party from liability for future negligence. In plain terms, it’s a pre-injury waiver:
“If something goes wrong, I won’t sue you.”

Florida courts allow these clauses, but they are disfavored, construed narrowly, and enforced only when the contract shows a clear and unequivocal intent to release the party from its own negligence. Levine v. Madley Corp, 516 So.2d at 1103.

Note that in Florida, the following can never be waived: 

• Gross negligence, 
• Intentional torts, 
• Statutory duties, and 
• Claims involving essential public services (e.g., hospitals and utility providers)

To summarize, exculpatory clauses are permitted, but courts scrutinize them heavily because they relieve a party of the duty to use reasonable care.

They must be unambiguous, conspicuous, and unmistakably clear. Note that it doesn’t matter if the word “negligence” isn’t specifically called out (e.g., “any liability whatsoever”, “any and all claims and causes of action of every kind”, “any and all physical or emotional injuries and/or damages”). Ask yourself whether the wording is clear enough that an ordinary and knowledgeable person would know what they are contracting away.

Any ambiguity → clause is void.

Florida will enforce a waiver of negligence only if the language is unmistakably clear and unambiguous.

When is a contract void as an illegal gambling agreement?

Florida has one of the strictest anti-gambling public-policy rules in the country.
Any contract founded on a gambling or wagering agreement is void and unenforceable.

This applies whether the agreement is formal or informal.

Florida Statutes void all contracts where the consideration is a “wager,” “bet,” or “stake.”

Courts interpret this broadly:

• If you only get paid if a risky, uncertain event occurs → likely a wager.
• If the agreement’s purpose is to shift risk based on chance rather than exchange legitimate consideration → void.

(Fla. Stat. 849.26)

Under section 849.26, Florida Statutes, any contract, note, or promise that secures repayment of gambling debts is VOID — even if the gambling occurred in another state where it was legal.

Signs of an illegal wager are:

• Payment contingent on a purely uncertain event, 
• No legitimate underlying business purpose, and 
• An attempt to profit from chance, not performance. 

Examples of void gambling agreements:

• A private agreement to split lottery winnings if one party buys the ticket,
• A bet on a fight, race, or sporting outcome, and 
• A side wager where one party pays only if a future uncertain event occurs. 
• A promissory note securing sports-betting debts is void and unenforceable (even though the parties agreed to the debt, argued judicial estoppel, and the gambling that occurred was legal). Taboda v. Duarte 

Exam Tip: If the contract is tied to a lawful commercial purpose and supported by mutual obligations, it is NOT a wager. 

Valid (not gambling):

• Insurance contracts (regulated and backed by risk-pooling)
• Contingency-fee agreements
• Performance bonuses
• Earn-outs in business acquisitions
• Market-based variable-rate loan adjustments

Florida Sample Essay (Gambling)

Prestige Motors (“P”) hosts an annual “Ultra Lap Challenge,” where participants drive high-performance cars on a private track. The entry contract requires each participant to pay a $2,000 fee and contains two key provisions:

1. Exculpatory Clause:
   “Participant releases Prestige Motors from all liability, including liability for Prestige’s own negligence.”

    

2. Prize Clause:
   “Participant may place an optional $1,000 ‘Performance Wager.’ If the participant completes the course in under 2 minutes 10 seconds, Prestige will pay the participant $10,000.”

Alex (“A”) signs the contract, pays the $2,000 entry fee and pays the $1,000 “Performance Wager.”
During the event, a Prestige employee forgets to secure a barrier. Alex hits the loose barrier, is injured, and cannot complete the run. Alex sues Prestige for negligence and also seeks the $10,000 prize money.

Prestige argues (1) the exculpatory clause bars the negligence claim, and (2) the “Performance Wager” clause is a valid promotional prize.

Issue 1 — Is the Exculpatory Clause Enforceable?

Rule: Florida enforces exculpatory clauses only if:

• Clear and unequivocal;
• Explicitly states it releases the party’s own negligence; and
• Does not violate public policy.

Florida does not enforce exculpatory clauses that attempt to waive gross negligence, intentional acts, or are unclear / ambiguous.

Application: The clause expressly states the participant releases Prestige from “all liability, including Prestige’s own negligence.” → Clear, explicit, unambiguous. No gross negligence is alleged; a loose barrier is ordinary negligence.

Conclusion: The exculpatory clause is valid and bars Alex’s negligence claim.

Issue 2 — Is the “Performance Wager” an Enforceable Contract or a Void Gambling Agreement?

Rule: Florida Statute § 849.26 voids any contract where the consideration is a wager or bet.
If payment depends on the outcome of a chance-based or uncertain event, and the agreement has no independent commercial purpose, the contract is void.

Florida distinguishes:

• Valid prizes tied to promotional contests with no wagering → enforceable.

• Wagers requiring entrants to stake their own money for a chance to win → void.

A lawful promotional prize must be free to enter or require a payment that is not tied to the chance element.

Application: Alex paid a separate $1,000 stake solely for the chance to win $10,000 if he beats a time threshold.
This is not part of the $2,000 entry fee (a legitimate commercial transaction).
The payment is a gambling stake, not a promotional contest:

• The payment is optional,

• The payoff is contingent on an uncertain performance outcome,

• Prestige profits from the wager itself.

This falls squarely within §849.26.
The “Performance Wager” is a wagering agreement, and thus void and unenforceable as a matter of public policy.

Impact of the accident: Whether Alex could have achieved the time is irrelevant.
A void gambling contract cannot be enforced under any circumstances.

Conclusion: The “Performance Wager” clause is a void gambling agreement. Alex cannot recover the $10,000.

Final Conclusion:

• The exculpatory clause is enforceable, so Alex’s negligence claim is barred.
• The performance-based prize clause is an illegal wagering contract under Florida Statutes § 849.26, so Alex cannot recover the $10,000.
• Prestige Motors is not liable under either theory.

Bottom Line 

Florida enforces clearly written exculpatory clauses for ordinary negligence but voids any contract based on gambling or wagering. A prize tied to a paid wager is void; a release that explicitly waives negligence is enforceable. Public policy cuts both ways: Florida protects freedom of contract—but not when the contract is a bet.