Question 1

A statement of opinion such as "it is the best car in the lot" can amount to a misrepresentation.

Accepted Answer

A) True 
 B)False

Question 2

Rectification will be ordered where

Accepted Answer

A) there is a complete unambiguous agreement that was recorded incorrectly. 
B) the parties wish to change certain terms in the contract. 
C) one of the parties to the contract lacks legal capacity. 
D) the offeror misrepresented certain facts. 
E) the wrong party performs the contract. 
A) there is a complete unambiguous agreement that was recorded incorrectly. 
B) the parties wish to change certain terms in the contract. 
C) one of the parties to the contract lacks legal capacity. 
D) the offeror misrepresented certain facts. 
E) the wrong party performs the contract.

Question 3

Linda took out a new auto insurance policy.She signed without reading each of the papers presented to her by the agent.What she didn't realize was that the insurance only covered accidents on "public roads." This term in no way was brought to her attention nor explained.A few days later she got into a serious accident in a large housing development where the roads had not as yet been turned over to the municipality.The insurance company refused to pay the claim.Can Linda get damages under misrepresentation?

Accepted Answer

A) Yes,she can,since Linda is fully aware of the distinction between public and private. 
B) Yes,she can,since this is an example of misrepresentation by omission. 
C) No,she can't,because Linda is presumed to have read and understood the document. 
D) Yes,she can,since the terms correspond to commonly understood principles. 
E) No,she can't,because this is a standardized document that has been fully approved. 
A) Yes,she can,since Linda is fully aware of the distinction between public and private. 
B) Yes,she can,since this is an example of misrepresentation by omission. 
C) No,she can't,because Linda is presumed to have read and understood the document. 
D) Yes,she can,since the terms correspond to commonly understood principles. 
E) No,she can't,because this is a standardized document that has been fully approved.

Question 4

An innocent party can lose her or his right to repudiate a contract made with undue influence by

Accepted Answer

A) declaring that the special relationship between the parties no longer exists. 
B) not repudiating promptly after coming out from under the undue influence. 
C) tearing up the contract before its execution. 
D) physical retaliation after the contract's formation. 
E) reversing the role of the dominant party. 
A) declaring that the special relationship between the parties no longer exists. 
B) not repudiating promptly after coming out from under the undue influence. 
C) tearing up the contract before its execution. 
D) physical retaliation after the contract's formation. 
E) reversing the role of the dominant party.

Question 5

James purchases an antique chair at a garage sale for $150.00.Later he sells it to Jacqueline for $300 and makes a nice profit.A few months later the Antiques Road Show comes to town and Jacqueline takes the chair to the show to be valued.She is advised that the chair dates as far back as 1866 and is worth approximately $5000.Which of the following is TRUE?

Accepted Answer

A) James made a mistake about the value of the chair and so the contract will be set aside by a court. 
B) James did not make a legal mistake because he was careless in determining the right price. 
C) James can plead non est factum. 
D) James did not make a mistake about the value of the chair because the radically different price is one of the risks expected in the contract. 
E) If Jacqueline sells the chair,the court will order that Jacqueline pay a portion of the proceeds of sale to James because James made a mistake. 
A) James made a mistake about the value of the chair and so the contract will be set aside by a court. 
B) James did not make a legal mistake because he was careless in determining the right price. 
C) James can plead non est factum. 
D) James did not make a mistake about the value of the chair because the radically different price is one of the risks expected in the contract. 
E) If Jacqueline sells the chair,the court will order that Jacqueline pay a portion of the proceeds of sale to James because James made a mistake.

Question 6

It is a criminal offence for a lender to charge an interest rate in excess of 50 percent.

Accepted Answer

A) True 
 B)False

Question 7

Benny,who owns a classic car,lives in an apartment with a disabled roommate.Benny is approached by Dick Albert,who advises Benny that if he does not sell his classic car for $2000 (a fraction of its value),the roommate "will have both his arms broken." Benny then signs the contract and Dick pays him the $2000.Benny was never threatened at any time during the transaction.What remedies can Benny pursue and what must he do in order to pursue those remedies? What is the likelihood of success?

Accepted Answer

Benny would claim duress; in other words

Question 8

With respect to sale of goods,the doctrine of caveat emptor offers buyers the right to rescind the contracts in situations where

Accepted Answer

A) both a dominant and subservient party exist. 
B) there is a clear title in the sale of goods. 
C) one party is in a vastly superior position of knowledge with respect to some matter that is of vital importance to the other party. 
D) there is an unconscionable transfer of goods. 
E) there is a failure to disclose a problem with the ownership of goods. 
A) both a dominant and subservient party exist. 
B) there is a clear title in the sale of goods. 
C) one party is in a vastly superior position of knowledge with respect to some matter that is of vital importance to the other party. 
D) there is an unconscionable transfer of goods. 
E) there is a failure to disclose a problem with the ownership of goods.

Question 9

Some consumer protection legislation provides for a cooling-off period.What is a cooling-off period and how does it benefit consumers?

Accepted Answer

A cooling-off period gives a consumer th

Question 10

Explain the concept of rescission as it relates to mistake in contract law.

Accepted Answer

Rescission is an order of the court that

Question 11

Albert has agreed to sell his car to Larry for $14 000.00.Albert told Larry that the car had never been in an accident,was in good condition,and drove like a dream.Albert knew that this was untrue,but wanted to get as much money as he could for the car.In fact,the car had been in two accidents,had substantial frame damage,and could not be driven safely on the road.Assume that Harry had no way of checking on the condition of the car and that the principle of caveat emptor does not apply.In this situation,Albert's statement about the car is

Accepted Answer

A) a negligent misrepresentation. 
B) an innocent misrepresentation. 
C) a fraudulent misrepresentation. 
D) a mere invitation to treat. 
E) none of the above 
A) a negligent misrepresentation. 
B) an innocent misrepresentation. 
C) a fraudulent misrepresentation. 
D) a mere invitation to treat. 
E) none of the above

Question 12

Donna Brown owned a flower shop,which she was anxious to sell.Charles Blue visited her shop and discussed a possible purchase.During those discussions,Donna stated that she was sure 2013 sales would exceed $400 000 and that sales for 2012 were more than $360 000.Charles was impressed with those figures and offered to purchase the flower shop for $110 000 cash.The sale was completed one week later (November 24,2012)and was documented with a brief written agreement that did not include anything about past sales.In April 2013,Charles had the 2012 financial statement for the flower shop prepared and discovered that actual sales for 1997 were $320 000.In addition,Charles knew that 2013 sales were 5 percent below sales for the same period a year earlier.Charles confronted Donna with those figures and Donna was evasive and refused to accept any responsibility,saying only that the written agreement contained no mention of sales figures.Charles asks you the following questions:
a.Do I have a right to sue Donna,and if so,what is the legal basis for my action? What must I prove and what are my chances of success?
b.What remedies could I seek,and do I have different remedies from which I can choose?

Accepted Answer

a.Because the representation about sales

Question 13

At times,the concepts of undue influence and duress may overlap.Explain.

Accepted Answer

Although both undue influence and duress

Question 14

Cindy bought a car from Ben,who had bought it from John.When Ben bought the car,John lied to Ben and told him that the car had a new engine.As a result,believing that the engine was new,Ben told this to Cindy.Before she bought the car,Cindy had her mechanic inspect it and when Cindy asked him about the engine,he got her car confused with another customer's car and told her that it did indeed have a new engine.Cindy,who has owned the car for two months,has just discovered that the engine is not new and will need to be replaced soon.What remedy or remedies would Cindy most likely be entitled to and why?

Accepted Answer

A) rescission only from Ben for breach of contract 
B) damages from the mechanic for negligent misrepresentation 
C) rescission and damages from Ben for fraudulent misrepresentation 
D) rescission from the mechanic for negligent misrepresentation 
E) damages only from Ben for fraudulent misrepresentation 
A) rescission only from Ben for breach of contract 
B) damages from the mechanic for negligent misrepresentation 
C) rescission and damages from Ben for fraudulent misrepresentation 
D) rescission from the mechanic for negligent misrepresentation 
E) damages only from Ben for fraudulent misrepresentation

Question 15

What is rectification? Explain its use by courts in situations involving mistake in law.

Accepted Answer

Rectification is the correction of a wri

Question 16

At common law,a mistake by an innocent party as to the identity of the other party usually involves

Accepted Answer

A) a mistaken assumption. 
B) fraud. 
C) the element of surprise. 
D) an ambiguous term. 
E) the element of risk. 
A) a mistaken assumption. 
B) fraud. 
C) the element of surprise. 
D) an ambiguous term. 
E) the element of risk.

Question 17

When a court grants rectification of a contract,it

Accepted Answer

A) declares a contract to be unenforceable. 
B) changes the part of the document that was incorrect in the written document. 
C) sets aside the contract. 
D) declares the contract to be voidable. 
E) interprets the contract for the parties. 
A) declares a contract to be unenforceable. 
B) changes the part of the document that was incorrect in the written document. 
C) sets aside the contract. 
D) declares the contract to be voidable. 
E) interprets the contract for the parties.

Question 18

Contracts between parties of unequal bargaining power that are unfairly advantageous to the powerful parties have long been considered

Accepted Answer

A) bilateral contracts and void. 
B) unilateral contracts and voidable. 
C) unconscionable contracts and voidable. 
D) non est factum. 
E) contrary to the Criminal Code of Canada. 
A) bilateral contracts and void. 
B) unilateral contracts and voidable. 
C) unconscionable contracts and voidable. 
D) non est factum. 
E) contrary to the Criminal Code of Canada.

Question 19

Independent Legal Advice must come from a lawyer not associated with the transaction or the other parties.

Accepted Answer

A) True 
 B)False

Question 20

What is the difference between a void and a voidable contract?

Accepted Answer

A void contract is one that is nullity f

Exam 9: Grounds Upon Which a Contract May Be Set Aside: Mistake and Misrepresentation

A statement of opinion such as "it is the best car in the lot" can amount to a misrepresentation.

Rectification will be ordered where

An innocent party can lose her or his right to repudiate a contract made with undue influence by

It is a criminal offence for a lender to charge an interest rate in excess of 50 percent.

With respect to sale of goods,the doctrine of caveat emptor offers buyers the right to rescind the contracts in situations where

Some consumer protection legislation provides for a cooling-off period.What is a cooling-off period and how does it benefit consumers?

Explain the concept of rescission as it relates to mistake in contract law.

At times,the concepts of undue influence and duress may overlap.Explain.

What is rectification? Explain its use by courts in situations involving mistake in law.

At common law,a mistake by an innocent party as to the identity of the other party usually involves

When a court grants rectification of a contract,it

Contracts between parties of unequal bargaining power that are unfairly advantageous to the powerful parties have long been considered

Independent Legal Advice must come from a lawyer not associated with the transaction or the other parties.

What is the difference between a void and a voidable contract?

Law, society, and Business

The Machinery of Justice

Government Regulation of Business

The Law of Torts

Professional Liability: the Legal Challenges

Formation of a Contract: Offer and Acceptance

Formation of a Contract: Consideration and Intention

Formation of a Contract: Capacity to Contract and Legality of Object

Writing and Interpretation

Privity of Contract and the Assignment of Contractual Rights

The Discharge of Contracts

Breach of Contract and Its Remedies

Sale of Goods and Consumer Contracts

Bailment and Leasing

Insurance and Guarantee

Agency and Franchising

The Contract of Employment

Negotiable Instruments

Intellectual Property

Interests in Land and Their Transfer

Landlord and Tenant

Mortgages of Land and Real Estate Transactions

Sole Proprietorships and Partnerships

The Nature of a Corporation and Its Formation

Corporate Governance: the Internal Affairs of Corporations

Corporate Governance: External Responsibilities

Secured Transactions

Creditors Rights

International Business Transactions

Electronic Commerce

Privacy

Filters