Exam 8: Factors Affecting the Contractual Relationship

Joe, a student at the local college, had a one-year lease on a suite in a house owned by Sam. Sam sold the house to Jones without telling Jones about the lease. When he discovered Joe in the suite, he demanded that Joe leave. Explain the rights of the parties in terms of privity of contract.

The major problem with fraudulent misrepresentation is the need to establish that the person being sued knowingly misled the victim.

Joe owned an apartment building and entered into a contract with Sam whereby Sam would operate the apartment building but the proceeds from the rent and profits would be distributed among Joe's children. If Joe were to die and Sam were to refuse to pay out any profits to the children, what could they do?

While selling the contents of his house in preparation for a move to a condominium, Mr. Lotski sold an antique desk to a Mr. Rogers, who paid by a cheque that was later returned N.S.F. (nonsufficient funds). Lotski later learned that Rogers had sold the desk to Mrs. Lee for cash, which he took and then disappeared. Who is entitled to the desk if the court holds that the first contract between Lotski and Rogers is voidable?

Correction by the court of the wording of a mistake in the contract is known as ________.

Performance by another qualified person of the obligations under a contract is known as ________.

Joe owned an apartment building and entered into a contract with Sam whereby Sam would operate that apartment building, but the proceeds from the rent and profits would be distributed among Joe's children. This is an example of what kind of an agreement?

A windfall that one party to a contract stands to make at the expense of the other is known as ________.

Misunderstanding occurs when each party has a different understanding of the terms of the agreement, in which case the courts apply a reasonable interpretation of the contract.

When two parties are involved in a mutual mistake (misunderstanding) as to the meaning of a term of the contract, which of the following is usually applied by the court to settle the matter?

Mr. Frank, a foreman supervising some 43 employees, was asked by his secretary to sign a form requesting additional supplies needed on the factory floor. He was not careless when he examined the form, but his secretary had cleverly arranged the signature line so that instead of signing a request for supplies he signed a cheque payable to his secretary. What principle, if any, would be used to defend against her action on the cheque?

If Mills agreed to sell Boothe a used Nissan automobile, which in the contract was described as a 2012 Nissan Murano with a rebuilt transmission, Boothe could sue for ________ if the vehicle turned out to be a 2010 Murano and the transmission was used, not rebuilt.

Lars Jepsen, a fisherman from Tofino, regularly sells his catch to packing plants in Steveston. His shipment had already left dock last Monday, but he didn't contract for its sale until yesterday. He sold this shipment for $10,000 to B.C. Packers. Jepsen still owes Sam $3000, part of his commission for having sold one of his waterfront properties. This morning he assigned to Sam, in writing, $3000 of the $10,000 owed under the contract with B.C. Packers. Unknown to Jepsen or B.C. Packers, at the time they made the contract, his transporter had gone down in a storm and all the cargo was lost. Jepsen had no insurance for loss of his boat. Which of the following is correct with respect to his legal position?

Mrs. Sharp, the owner of a restaurant, induced the Morissons to buy the business by a misrepresentation; the invoices made her costs appear less than they actually were, and thus her profits more than they actually were. On these facts, which of the following is False?

A week after signing a contract, you became aware that you and the other party, Sheldon, seemed to have a different understanding of one of the provisions of the contract. Before you said anything to him, you reread it to see if your interpretation was valid. As you reread it, you noticed that not only was that provision vague, but also other terms and provisions were ambiguous or left out. Which of the following is False with regard to the methods used by the courts to interpret contracts?

Mr. Jans owned a small building with four offices upstairs and a restaurant on the main floor. Jans contracted with a company, Signs Limited, to construct a sign indicating the names of his tenants and their room numbers. The sign was created and installed by John Monet, an employee of Signs Limited. Signs Limited assigned $500 of the $700 contract price to Ms. Franz, its landlord, when she called and pressed for the rent. Ms. Franz gave notice of the assignment in writing to Jans. Read the following statements, independently of one another, and indicate which is the true statement.

A provision in equity whereby one person transfers property to a second person obligated to use it to the benefit of a third is known as ________.

Where the misleading statement being complained of was an expression of opinion rather than fact, it is not actionable, even if the person making the statement was an expert.

With regard to the law concerning misrepresentation, which of the following is true?

The victim of a fraudulent misrepresentation can also seek punitive damages, that is, damages intended to punish the wrongdoer rather than compensate the victim.