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

Why are loan transactions among the most heavily scrutinized consumer contracts? What protections are provided to consumers?

Mistake about terms includes the inadvertent use of wrong words.

You innocently have made some misstatements that others are relying on.Legally speaking,you can change your situation from innocent misrepresentation into one of fraudulent or negligent misrepresentation by

Explain the meaning of rescission.

Jack really needs money to pay off his mortgage before the bank forecloses.He goes to "Shark" who agrees to lend Jack the money if Jack will pay 100 percent interest.This is an example of undue influence.

Why are public corporations required to give the investing public information about any new issue of shares in a statement called a prospectus?

Brandy wants to buy a car.Her credit rating will not allow her to borrow from a bank,so she goes to a private lender.This lender asks her to sign a contract that has lots of restrictive terms,which he rushes by without explaining or allowing her to read them.What is the issue?

What is a material event?

Both rescission and damages are available remedies for misrepresentation only when the misrepresentation is

Regarding misrepresentation in a sale of land

You are going to lend money to a corporation owned by Mr.X.You are requiring that Mr.X and his wife,Ms.Y,sign personal guarantees agreeing to be responsible in case of default.Why might you be concerned about your ability to enforce the guarantee against Ms.Y,and how should you protect your position?

McKenzie purchases goods from Dormond.Later McKenzie goes to court and the court declares that the contract between McKenzie and Dormond is void.This means that

Where the wrong words are inadvertently used by a party in stating the terms of a contract,resulting in a mistake,the contract will be binding on the party if it was reasonable for the other party to rely on the words used.

When describing the car he had for sale,Jack told Jill it had genuine cowhide seat covers.The car in fact had imitation leather seat covers.Jill decided to buy the car,in part because she liked cowhide seat covers.The written contract made no mention of the type of seat covers.When Jill took possession of the car,she discovered that the seat covers were not cowhide and asked you the following questions: a.What is the name of all potential causes of action that I have has against Jack? b.What remedy or remedies can I seek? c.What elements must I be able to prove in order to be successful? Answer the above questions providing reasons for your answers.Express an opinion about the probable outcome of Jill's action.

James says to Jack,"I am selling my Toyoda for $500.Would you like to buy it?" Jack,believing that James was referred to his automobile,replies,"Yes,I'll buy your Toyota for $500." Jack pays $500 and James presents him with a Japanese doll called Toyoda.Jack asks for his money back because he misunderstood James.Should this matter go to court,the court will most likely find that

Define undue influence and distinguish undue influence from duress.

Which of the following is NOT a condition that must be met by a plaintiff who request rectification of a contract?

What is rescission? Explain how rescission relates to mistake in contract law.

An innocent party can lose her or his right to repudiate a contract formed as a result of undue influence by

What must an innocent party to a contract show in order to rely on the defence of non est factum?