Exam 13: Genuineness of Assent and Undue Influence

A misrepresentation of law is actionable if one party to the contract is a professional and should know what the law is and intentionally misrepresents the law to a less sophisticated contracting party.

Generally,mistake in value allows for rescission.

Robert is a pastor at United Church.One of the members of his congregation,Mrs.Smith,is a very devout believer.Robert convinces Mrs.Smith to sell him her farm for $5,000.The actual value of the farm is $500,000.Mrs.Smith dies and her estate sues to get her farm back.Which of the following best describes this situation?

Murphy owned some farmland outside the city.He was interested in selling the land,so he told the first prospective purchaser,Jim,that the state was going to build a bypass around the city that would go directly through this land,making it more valuable.Murphy told Jim that he would like to hold on to the land until the bypass was built,but he needed money desperately.Based on Murphy's statements,Jim bought the land for $2,000 per acre.As farmland,it was worth only $1,000 per acre,but with the bypass,it would be worth $5,000 per acre.Murphy knew that there were no plans for a bypass.Jim learns of this,and sues Murphy.Discuss whether Jim has any grounds to obtain relief in this situation.Discuss fully the legal theories involved.

Jill asks Jack to give her an estimate in the price of building a fence around her orchard.Jack inspects and measures Jill's apple orchard and gives Jill an estimate of $1,000.Jill agrees to the price and they sign a contract.Jill,however,had in mind a fence around her peach orchard that is much larger than the apple orchard on which Jack based his estimate.Jack says he cannot build a fence around the peach orchard for $1,000,but Jill wants to hold Jack to the $1,000 for a fence around the peach orchard.Which of the following statements best describes this situation?

Sam wants to sell his stereo system because one side of his amplifier occasionally doesn't work properly and the cost of repair is so high that Sam wants to get a new stereo.Otherwise,it works well and the sound quality is very good.Sam places an advertisement in the newspaper and Bob comes to look at the stereo.Bob tries it out and likes what he hears.The following conversation then takes place: Bob: How does it work? Sam: Listen for yourself.Isn't that sound great? Bob: Yes,it is.Have you ever had to have it repaired? Sam: It's never been repaired ...it's just as it came from the factory.Try the CD,the cassette tape,and the tuner.You'll see they all work. Bob plays a cassette tape and after a few minutes,the sound on the left channel sounds distorted. Bob: This was sounding great,then all of a sudden it didn't sound right.I know a lot about stereos and that just didn't sound the way it should. Sam: Try the CD and I'll get another tape. Bob plays the CD and no further problem occurs.Bob then tries a different cassette tape and no further problem occurs.Bob spends an hour or so playing and testing the stereo system.Sam and Bob then negotiate a price.Bob pays and takes the stereo home only to discover the problem.Bob wants to get out of the contract.Discuss whether Bob can get out of the contract and get his money back.

Jay offers to buy a car from Leslie.He requests that she provide receipts and invoices from all repairs made to the vehicle during the past year.She agrees,but does not give him all of the receipts.He later purchases that car and determines that the auto has significant mechanical problems.He should be able to prove a claim of:

A prediction,if proven to be incorrect,can form the basis of a fraud case.

Which of the following apply to contracts involving fraud?

A statement of opinion may form the basis for fraud.

When both parties are mistaken as to the subject matter of a contract,which of the following is true?

Where two parties contract for the sale of an old violin,but neither party realizes that it is a rare and extremely valuable violin,this is a mutual mistake of fact allowing rescission.

What is the effect of one party being mistaken about the subject matter of a contract?

Joanne goes to a garage sale where she finds jewelry for sale.She buys a handful of what appears to be costume jewelry for her daughter to play with.She pays $5 for it.Later,a friend of Joanne happens to see the jewelry and discovers that one piece consists of diamonds and is worth about $2,000.If the seller of the jewelry seeks to rescind this contract,which of the following is true?

A plaintiff in a fraud case must prove which of the following?

Francis signs an agreement with Sam on July 21,but 4 days later decides he made a bad deal.Which of the following,if true,will be a legal basis for Francis to get out of the contract?

Beta Construction Company,a subcontractor,understates its bid due to a clerical error.If Acme Construction is the general contractor,can Acme enforce the contract as bid?

Assume that someone who has just inherited some artwork wants to sell some of it so he can use the money to buy drugs.He goes to an art dealer and asks the art dealer how much the art is worth.The art dealer can tell that the seller is desperate to sell the artwork,and tells the seller that the art is worth much less than its actual value.Based on this,the dealer negotiates a price and buys the artwork for much less than the seller could have received elsewhere.Were the actions of the dealer ethical in this situation? Can the seller rescind the contract? Should the seller be able to rescind the contract?

To be grounds for fraud,a misrepresentation must relate to:

An ambiguity in a contract will not constitute a mutual mistake of material fact.