Exam 11: Conduct Invalidating Assent

If a seller occupies a fiduciary relationship with the buyer and fails to make full disclosure to the buyer,then the latter will be able to avoid the transaction.

When both parties misunderstand the same set of facts relating to a basic assumption on which a contract is made,it is termed:

Historically,courts held that representations of law were statements of fact,but the present trend is to recognize that they have only the effect of statements of opinion.

Jill contracted to purchase Kevin's automobile under the belief that she could sell it at a profit to Linda,but after Jill bought the car,she found out that Linda isn't interested in buying it.Jill:

Albert found a stone in his yard and took it to Bob,a jeweler,for evaluation.Although Bob knew what the stone was,he told Albert that he wasn't sure as to the nature of the stone,but that he thought it was a topaz.Bob then offered to buy the stone for $25 and Albert agreed.Later Albert found out the stone was an uncut diamond worth about $700.The sale:

Kyle wants to buy a six-passenger car.The salesperson tells him that the two-seat sports car Kyle sees on the car lot would be just perfect for six people.Kyle test drives the car and then buys it.In this case:

Which of the following would ordinarily be a basis for making a contract void for mutual mistake?

The trustee of a trust does not owe a fiduciary duty to the beneficiary of that trust.

Define "mistake," "mutual mistake," and "unilateral mistake." Explain how the law treats mutual and unilateral mistakes.

An act that is contrary to public policy or is morally reprehensible may constitute duress.

The State of Florida enters into a contract with Treasure Salvors governing the salvage of a Spanish galleon that sunk in the 1600s.Under the terms of the contract,the salvagers agree to relinquish 25% of the items recovered to the State of Florida in return for the right to salvage on state lands.At the time the parties enter into the contract,they both believe that the seabed where the ship lies is state land.Subsequently,the United States Supreme Court holds that the continental shelf on which the ship rests has never been owned by Florida.The salvagers sue to rescind the contract.The contract:

For a misrepresentation to be material,it must be likely to induce a reasonable person to manifest assent or the maker must know that it would be likely to induce the recipient to do so.