Exam 11: Conduct Invalidating Assent

Which of the following does not exemplify a relationship that typically leads to scrutiny of a contract for undue influence?

For a misrepresentation to be actionable as fraud in the inducement,it must be a misrepresentation of an opinion.

An arm's-length transaction is one in which the parties owe each other special duties.

The remedies of damages and rescission are available for:

Physical compulsion and improper threats are the two basic types of duress.

Social coercion to enter into a contract cannot be a basis for avoidance of the contract.

Stewart entered into a contract with Will to have Will build a 10-unit apartment complex on Elm Street in Randolph County.Unknown to both parties,this land had recently been rezoned and only single-unit dwellings can be constructed.

The most uncommon type of duress involves the use of physical compulsion.

Scienter is the element of fraud that requires that the person who makes the misrepresentation knows that it is false or has reckless indifference as to its truthfulness.

Lorna is given papers to sign by a catering company for the food,service,and decorations at a wedding.Underneath the invoices are a carbon and a contract of sale for a portion of the failing catering business.As Lorna signs the papers,her signature is applied to the sales contract.This is a void contract because it was entered by fraud in the execution.

Nonfraudulent representation is made without scienter.

A party to a contract may be entitled to relief even if he is contributorily negligent in relying on a fraudulent misrepresentation.

If an agreement is not voluntary and knowing,it will be either void or voidable.

A collection agency threatened to sue Martha for the unpaid hospital bills from her heart operation.She signed a promissory note at a high but not illegal rate of interest.What result?

Name the two types of nonfraudulent misrepresentation.Identify the remedies that may be available.

A party to a contract may be able to avoid the contract if:

Actionable fraud would be likely to be based on falsity of:

Tommy's parents died in a plane crash and he went to live with his guardian,Aunt Rose.Rose had a very small house and did not have a separate bedroom and bath for 12-year-old Tommy.She and Tommy decided to use some of his inheritance to pay for an addition to the house.He had some shares of stock transferred into Rose's name so that she could sell them when the money was due to be paid.The stock transfers are:

Undue influence is the taking of unfair advantage of a person by reason of a dominant position based upon a confidential relationship.

Rescission is usually permitted where the parties to a contract are both mistaken about a material fact.