Exam 8: Factors Affecting the Contractual Relationship

A fraudulent misrepresentation which induces another person to enter into a contract can result in which of the following remedies?

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.

What is a trust?

"Where fraudulent misrepresentation is involved,the victim can obtain rescission and/or damages but where innocent misrepresentation is involved,the only remedy is damages." Discuss the accuracy of this statement.

The victim of fraudulent misrepresentation retains the right to have the parties to the contract returned to their original positions but not to be reimbursed for any out-of-pocket expenses.

Where a heavy-duty equipment supplier sells a truck claiming it can haul 10 tonnes of gravel but its actual capacity is only 5 tonnes,this is misrepresentation even where the seller believes what he said was true.

Mr.Zink hired Bruce Dorne to create a payroll program for his business.Bruce was to be paid $4000 for the program.When Bruce was half-way finished,a creditor to whom he owed $2000 pressed so hard for payment that Bruce assigned him $2000 of the contract price,an amount he felt he had earned already.The creditor,Mr.Pressing,gave written notice that very day to Mr.Zink.On these facts,which of the following is true? (Read each statement separately.)

What is a statutory assignment?

When two parties are involved in a 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?

Discuss the principle of caveat emptor and how it relates to misrepresentation in contract law.

Jenny went to the store and asked to see an AM-FM clock radio with an MP3 player.The salesperson brought out a clock that he said had all the features that Jenny wanted.After looking at the price tag and little else,she said she would think about it.The salesperson said that this was the most popular model sold,that they sold 1000 of them during the World Series alone,that it had the highest rating in Consumer Reports,and that he only had that one left.Jenny bought it.Later she found out that all the statements made to her by the salesperson were false,including the statement that the clock had all the features that she wanted,because it did not have an AM band.Which of the following is true?

The victim of ________ can seek monetary compensation as well as rescission for any loss incurred.

Duress takes place when one person takes advantage of another's vulnerability because of a special relationship with that person.

Privity of contract applies in which of the following situations?

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

Often a party to a contract wants to avoid his obligations by arguing that the contract was entered into because of a mistake,misrepresentation,undue influence,or duress.Which of the following is false with regard to these areas of the law?

Which of the following constitutes a misrepresentation that would not allow the courts to award the equitable remedy of rescission?

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.If Joe were to die and Sam were to refuse to pay out any profits to the children,what could they do?

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

Discuss how privity of contract affects the position of people who are not parties to a contract.In your discussion,include an examination of the Supreme Court decision in London Drugs Ltd.v.Kuehne & Nagel International Ltd.