Exam 13: Genuineness of Assent and Undue Influence

Mark was shopping for a used car in February.He went to AutoMegaWorld and test drove a used 2000 Tiger XL.While driving the car,he looked at the climate control center and noticed that the temperature lever was marked "cold" at one end in blue and "hot" in red at the other end.Mark assumed that the "cold" marking meant that the car had air conditioning.Mark wanted to finally have an air-conditioned car.The salesperson did not mention anything about whether this car was air conditioned,but while test-driving the car,Mark commented,"It will be great to have an air-conditioned car." The salesperson heard Mark and knew that the car did not have air conditioning,but said nothing.Mark bought the car.When Mark was showing his new car off to friends,one of them showed him that the car was not air conditioned.In this circumstance,which of the following is true?

You go to the Cosmic Runners Supply Store in Asheville.The salesperson shows you some shoes and says,"In a race,these shoes pick up the cosmic energy from the runners around you and channel it into your own legs.This causes everyone with these shoes to run twice as fast as in normal shoes." In your next race,you do only slightly better than usual and sue for fraud.Which of the following is true?

So long as the plaintiff in a fraud in the inducement case actually relied on the defendant's false statement,the reliance element is met.

A party who has been a victim of fraud in the inducement can:

Assent may still be present even if a party entered into a contract based on mistake.

Heidi persuades Iris to buy her used Ford Escort by telling Iris that the car "handles better than any car I have ever owned." Heidi's statement is:

Sandy Student is having difficulties in her advanced accounting class this semester.Sandy,who is a 21-year-old senior,is out consuming green beer on St.Patrick's Day and runs into Professor Debit,who was Sandy's Principles of Accounting professor.Sandy and Professor Debit discuss Sandy's current problems in accounting and have the following conversation: Sandy: I just don't get it.I really know the material,I don't know how I got a "D" on the first exam.Professor Consolidation's exams are so hard. Debit: I know that.I know a little about how Professor Consolidation makes up those exams.We've team-taught that course in the past.And,we see each other often.I'll tell you what I can do if you like.Before each of the remaining exams,we'll get together and I'll tell you exactly what you need to know to do well.We'll take as long as you want on a Saturday for a flat fee of $100. Sandy: That sounds good except for one thing.I'm flat broke.I don't know if you remember that I work weekends at the Divide Basin Ski Area checking lift tickets.How about if I pay you $40 each exam,but allow you to ski without checking your lift ticket anytime I am working.Just make sure you have an old lift ticket on so everything looks proper. Debit: It's a deal.Let's get another pitcher of this Old Stumpshovel Green Beer.I don't know if it's green from food coloring or from age,but it's finally starting to go down pretty smoothly. The next exam comes along and Professor Debit spends several hours on a Saturday with Sandy.Sandy does better on that exam,but not as well as she had hoped because unknown to Debit or Sandy,Professor Consolidation had changed the format of his exams.The following week,Professor Debit goes skiing.As agreed,he has an old lift ticket visible,and Sandy lets Debit through the line,but tells Debit,"You are going to have to get a ticket after you take this run.I didn't get an "A" on that exam,so I don't feel I owe you anything.Besides,I'm now afraid I may get caught." Professor Debit buys a lift ticket and skis the rest of the day.Debit cancels class Monday morning in order to meet with an attorney regarding a lawsuit against Sandy,who has not yet paid the $40 for the session.If you were Debit's lawyer,what would you tell Debit about the strengths and weaknesses of the case against Sandy? Among Sandy's claims is a claim that the mistake over the format of the exam should allow her to rescind the contract.

A ________ exists if both parties know the object of the contract but are mistaken as to its value.

Intentional misrepresentation is commonly referred to as "fraud."

Mark was shopping for a used car in February.He went to AutoMegaWorld and test drove a used 2000 Tiger XL.While driving the car,he looked at the climate control center and noticed that the temperature lever was marked "cold" at one end in blue and "hot" in red at the other end.Mark assumed that the "cold" marking meant that the car had air conditioning.Mark wanted to finally have an air-conditioned car.He did not discuss air conditioning in any way with the salesperson.Mark bought the car.Later,when Mark was showing his new car to friends,one of them pointed out to him that the car was not air conditioned.In this circumstance,which of the following is true?

The threat to bring a legitimate criminal lawsuit can support a duress claim.

Nancy was shopping for a new car and had a 1998 Honda Accord to trade in.In the negotiating process,the appraiser at the dealer took her car for a test drive to aid in the appraisal process.Nancy had found a car she liked and began negotiations in earnest.They settled on a price for the new car,with a final agreement contingent on an acceptable amount for the trade-in.When the sales manager brought a contract showing the price of the new car,with the deduction for the trade in,it noted "1999 Accord" as the car traded in.Everything else in the car's description (mileage,etc.)was correct.Nancy noticed this but said nothing and quickly signed the contract.A few minutes later when Nancy went to sign over the certificate of title on her old car,the sales manager said that the deal was off because he had based his trade-in allowance on the car being a 1999 model.Nancy said she would take the deal only as it was,and would not accept a lower trade-in allowance.After some further negotiations,the dealer agreed to grant the trade-in allowance as originally stated.Nancy signed over the title and took the new car home.The next morning,the sales manager called and said that the dealer was rescinding the contract based on the mistake.Discuss the issues and how this case would turn out.

Where a party was given a document to sign and told that it was one type of document,but in reality was a different legal document,that party would have a claim based on:

The owner of a dance studio tells Rupert if he takes just one dance lesson for $50,his life will change forever.Rupert takes the lesson and his life remains the same.The dance instructor's statements could be described as:

Donald is looking at a new Porsche Boxster,and the salesman tells him that driving the Porsche should improve his love life.Based on this and the fact that Donald thinks the Porsche is really nifty and swell,he buys the car.Donald sues the dealer because his love life has not improved.Which is true?

If the seller of a product makes a misrepresentation of law that the buyer relies upon,can the buyer rescind the contract?

John was the oldest of three boys.John's mother was single,elderly,and owned her own home.Her primary concern was leaving her home to her children and minimizing taxes.John was an attorney and a certified public accountant.John told his mother that he would draw up a trust arrangement whereby she would live in the home as long as she was able to,and at that point (or upon her death if she lived in the home at that point),the home would be transferred to her three children,with John in charge of selling it,either to an outsider or to one of her three children.When his mother moved to an apartment,it was discovered that the trust transferred the house to John only.Discuss this situation.

Fraud in the inception exists when the misrepresentation occurs at the beginning of negotiations.

The knowledge that a misrespresentation is false is known as: