Deck 13: Genuineness of Assent and Undue Influence

Question 1

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.

Answer 1

False

Question 2

A fraudulent misrepresentation may be used to show that genuine assent was lacking in a parties' contract.

Answer 2

True

Question 3

A preexisting relationship is a required element of a duress claim.

Answer 3

False

Question 4

Assent may only be demonstrated by words.

Question 5

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

Question 6

A statement of opinion may form the basis for fraud.

Question 7

The assent of parties to a contract must be voluntary.

Question 8

Ordinarily,silence is not a misrepresentation.

Question 9

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

Question 10

Generally,a unilateral mistake allows either party to rescind the contract if the other party knew or should have known that a mistake was made.

Question 11

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.

Question 12

In order to recover damages for fraud,the innocent party must prove that the fraud caused economic injury.

Question 13

When only one party to a contract is mistaken about a material fact that is the subject matter of the contract,that party will not be permitted to rescind the contract.

Question 14

Silence is actionable misrepresentation anytime it relates to a material fact.

Question 15

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.

Question 16

Intentional misrepresentation is commonly referred to as "fraud."

Question 17

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

Question 18

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

Question 19

Generally,a mutual mistake does not allow either party to rescind the contract.

Question 20

Generally,mistake in value allows for rescission.

Question 21

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

A) Yes; this is considered to be fraud by concealment.
B) Yes; this is considered to be fraud in the inducement.
C) Yes; this is considered to be fraud in the inception.
D) No; each party to the contract is assumed to know the law that applies.
E) Not unless the buyer contacted his attorney.

Question 22

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

A) misrepresentation of a material fact
B) intent to deceive
C) knowledge of the statement's falsity
D) justifiable reliance on the false statement
E) All of these are correct.

Question 23

Under which of the following circumstances can the mistaken party rescind a contract when there is a unilateral mistake?

A) The mistaken party first held the mistaken belief prior to entering into the contract.
B) The mistaken belief is one that a reasonable person would have.
C) The nonmistaken party was aware of the mistaken party's belief.
D) The mistake has a material effect on the value of the contract.
E) The mistake did not become known until after the formation of the contract.

Question 24

Where two parties contract for the purchase and sale of an ordinary item,such as a desk,that unknown to both parties is a rare and valuable example of that item,this is:

A) a unilateral mistake
B) a case of fraud in the inception
C) a mutual mistake of fact
D) a mistake of value,but not a mistake of fact
E) a case of fraud by concealment

Question 25

Which of the following apply to contracts involving fraud?

A) The innocent party's assent is not genuine
B) The misrepresentation was of a past or existing material fact.
C) The intent to deceive the innocent party can be inferred from the circumstances
D) All of these are correct.

Question 26

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

A) Either party can rescind the contract.
B) Only the party injured by the mistake can rescind the contract.
C) Only the party who first discovers the mistake can rescind the contract.
D) Neither party can rescind the contract.
E) Either party can rescind the contract or recover damages from the other party.

Question 27

No special relationship between the parties is necessary to find undue influence.

Question 28

In undue influence,the persuasion by the dominant party must have overcome the free will of the innocent party.

Question 29

Which of the following is true about misrepresentations of law?

A) A misrepresentation of law is usually not a basis to recover because both parties are assumed to know the law.
B) A misrepresentation of law is treated as fraud in the inducement.
C) When an expert in the law makes a misrepresentation of law to a less sophisticated party,the misrepresentation is not actionable because each party is presumed to make its own investigation of the applicable law.
D) A misrepresentation of law is treated as a unilateral mistake.

Question 30

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

A) unilateral mistake
B) unilateral mistake of value
C) mutual mistake of a material fact
D) mutual mistake of a value
E) mutual mistake of identity

Question 31

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

A) The mistaken party can rescind the contract.
B) Either party can rescind the contract.
C) Either party can rescind the contract,and the mistaken party can recover damages.
D) There is no effect.
E) Neither party can rescind the contract or recover damages.

Question 32

The threat to bring a criminal charge (lawsuit)or civil lawsuit is duress.

Question 33

The case that involved two ships,both of which were named "Peerless," is:

A) Raffles v. Wichelhaus
B) Konic International Corp. v. Spokane Computer Services,Inc.
C) Wilson v. Western National Life Insurance Co.
D) Lucy v. Zehmer
E) Fisher v. Bell

Question 34

Under which of the following types of misrepresentation is the innocent party usually not able to rescind a contract?

A) fraud in the inducement
B) fraud in the inception
C) silence as misrepresentation
D) misrepresentation of law
E) innocent misrepresentation

Question 35

The knowledge that a misrespresentation is false is known as:

A) duress
B) undue influence
C) scienter
D) fraud in the factum
E) res ipsa loquitur

Question 36

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:

A) fraud in the inception
B) fraud in the inducement
C) fraud by concealment
D) fraud by undue influence
E) fraud by duress

Question 37

A contract between two parties in a fiduciary relationship,which unduly benefits the dominant party,is presumed to have been made under undue influence.

Question 38

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

A) a material existing fact
B) a any existing fact
C) a statement of opinion
D) a past event
E) a written statement

Question 39

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

Question 40

In a situation where one party to a contract has lied about the subject matter in order to entice the other party to enter into a contract,the type of fraud that would most likely be present is:

A) fraud in the execution
B) fraud in the inducement
C) fraud by concealment
D) fraud by undue influence
E) fraud by duress

Question 41

You buy a pair of very used skis for $25 from a store in Steamboat Springs.You learn later that Billy Kidd,a famous skier,owned the skis years ago.The store demands that you return them because it did not know that they once belonged to Billy Kidd.Which is true?

A) The store can force you to return them based on mutual mistake.
B) The store can force you to return them based on unilateral mistake.
C) You can be forced to return the skis because you have defrauded the store owner.
D) The store will not be able to force you to return the skis.

Question 42

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?

A) Yes; if there is no reason to doubt its accuracy.
B) Yes; even if Acme Construction knew there was an error,it can enforce the contract.
C) No; not if the mistake was the result of gross negligence on the part of Beta Construction.
D) No; not if the mistake is so serious that enforcing it would be unconscionable.
E) A and D are correct.

Question 43

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:

A) statements of fact
B) fraud in the inception
C) statements of opinion or sales talk
D) fraud by concealment

Question 44

Undue influence is characterized by one party being put at a disadvantage in a contract due to:

A) a party taking advantage of superior knowledge about the subject matter in a contract
B) a party taking advantage of economic advantage in a transaction
C) a party taking advantage of it being less urgent for that party to reach an agreement
D) a party taking advantage of a fiduciary relationship
E) a party taking advantage of the other party's legal circumstances

Question 45

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?

A) Mark can avoid the contract on the basis of mutual mistake.
B) Mark can avoid the contract on the basis of unilateral mistake.
C) Mark can avoid the contract on the basis of fraud by concealment.
D) Mark can avoid the contract on the basis of fraud in the inducement.
E) Mark cannot avoid the contract on the basis of his unilateral mistake.

Question 46

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?

A) You would lose because the statement did not contain a factual assertion.
B) You would lose because your reliance was not justified.
C) You would win if most runners do not go twice as fast in the cosmic shoes.
D) Proving only that the salesperson intended to deceive you is enough to win your fraud case.

Question 47

Gerald was a subcontractor,bidding on a contract for XYZ Corp.,the general contractor.When adding up the total of materials and labor,Gerald's secretary made a clerical error with a total of $45,000 instead of $450,000.Gerald then submitted his bid for $45,000.XYZ accepted Gerald's bid of $45,000,mostly because all the other bids were over $400,000.When Gerald learns of his mistake,he tells XYZ that he cannot perform the contract.If XYZ sues to enforce this contract,what is the most likely result?

A) The contract is fully enforceable because there was a valid offer and acceptance.
B) This is a bilateral mistake,so either party can rescind the contract.
C) This is a unilateral mistake,which can usually be rescinded by the mistaking party.
D) Because XYZ should have known that this was an error,Gerald will be allowed to rescind the contract.
E) This is a case of economic duress and Gerald will be allowed to rescind the contract.

Question 48

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?

A) He did not receive a fair price for the goods or services he sold in the contract.
B) The consideration given up by Francis was twice the value of that given up by Sam.
C) Sam breached a contract with Francis last year.
D) Both Sam and Francis are mistaken as to the subject matter of the contract.

Question 49

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?

A) This is a case of mutual mistake.
B) This is a case of unilateral mistake.
C) This is a case of innocent misrepresentation.
D) This is a case of fraud.

Question 50

Jennifer was shopping at Good Deal Auto Sales.The salesperson showed her one particular car that caught her fancy.The salesperson said that the car was a 1999 model,only had 25,000 miles,had been overhauled one year ago,and was the best buy for the money anywhere in town.Jennifer knew the car was a 1998 model,but otherwise she believed the salesperson.She bought the car.Later it is discovered that the car had 125,000 miles,had been overhauled 14 months ago,and that a better buy existed at another dealer.Each of these things makes the car worth much less than Jennifer paid for it.The salesperson and the dealership knew all these things.Jennifer sues for fraud.Which of the following best describes this situation?

A) The statement concerning the overhaul is a material misstatement.
B) The statement concerning the model year constitutes actionable fraud.
C) The statement concerning being the best buy in town for the money constitutes actionable fraud.
D) The statement about the mileage constitutes actionable fraud.
E) Both A and D are correct.

Question 51

Sally is thinking about buying Linda's car.Linda knows that there is a leak in the brake line,and that after driving the car for a few minutes,the brake fluid will leak out and the car will have no brakes.Sally does not ask about it and Linda does not tell her.Sally buys the car,and while driving home,the brakes fail.Sally has an accident and the car is destroyed.Sally sues Linda for fraud to get her money back.Which is true?

A) This is not fraud,since there was no misrepresentation.
B) This is not fraud,since there was no reliance.
C) This is not fraud,since there was no scienter.
D) Silence in this situation is a misrepresentation.
E) Silence is never a misrepresentation.

Question 52

Contracts involving fraud and misrepresentation are:

A) actionable only if in writing
B) void
C) valid
D) voidable

Question 53

Which of the following best describes duress?

A) A situation where a trust relationship has been violated in forming a contract.
B) A situation where a party has improperly given the other party no alternative but to enter into a contract.
C) A situation where one party has lied to the other to lead them to enter into a contract.
D) A situation where,after the contract was negotiated,circumstances have changed so that one of the parties is in a desperate circumstance and cannot reasonably perform.

Question 54

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

A) rescind the contract only
B) collect damages only
C) rescind the contract or collect damages
D) force the other party to live up to the agreement,but not rescind the contract or collect damages

Question 55

Which of the following statements is true regarding duress?

A) Threats of blackmail or extortion constitute duress.
B) The threatened party must prove that she had no reasonable alternative but to enter into the contract.
C) A threat to not drop a frivolous civil lawsuit constitutes duress.
D) A and B only are true.
E) A,B,and C are all true.

Question 56

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?

A) Mark can avoid the contract on the basis of mutual mistake.
B) Mark can avoid the contract on the basis of unilateral mistake because the salesperson knew that Mark was mistaken.
C) Mark can avoid the contract on the basis of fraud by concealment.
D) Mark can avoid the contract on the basis of fraud in the inducement.
E) Mark cannot avoid the contract on the basis of his unilateral mistake.

Question 57

Martha was selling some land she owned in Florida to Mary.Martha told Mary that there was a golf course and swimming pool in the subdivision as part of the development,and that other improvements would be made soon.Martha knew that none of these improvements existed and none were planned.Mary believed Martha and bought the land for $100,000 when it was really only worth $20,000.Mary learns of the error and sues Martha for fraud.Which of the following statements best describes this situation?

A) Mary cannot recover because the misrepresentation was not of a material fact.
B) Mary cannot recover because she can prove no damages.
C) Mary can rescind the contract because this is an innocent misrepresentation,but Mary cannot collect damages.
D) Mary can rescind or recover damages because this is clearly fraud.
E) Either party can rescind because this is a case of mutual mistake.

Question 58

Barb bought a 1968 Plymouth Valiant with 24,000 miles (the correct mileage)on it from Jolly John's Gently Used Car Sales.John told Barb that this car was used by a little old lady who only used it to go to church on Sundays.A couple of months later,Barb learned that the little old lady's Sunday trips were to the bingo parlor,not to church,and Barb learns that John knew this all along.Based on this information,Barb can probably:

A) get out of the contract on the basis of fraud
B) get out of the contract on the basis of undue influence
C) get out of the contract on the basis of unilateral mistake
D) get out of the contract on the basis of duress
E) not get out of the contract based on any of these reasons

Question 59

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) This is a case of mutual mistake,which allows either party to rescind the contract.
B) This is a case of mutual mistake in value; the contract is fully enforceable.
C) This is a case of unilateral mistake by the seller,who can rescind the contract.
D) This is a case of fraud in the inducement,and the seller can rescind the contract.

Question 60

Where one party takes advantage of a confidential relationship when entering into a contract,the remedy would be based on:

A) duress
B) unconscionability
C) undue influence
D) unilateral mistake
E) fraud in the execution

Question 61

Assuming that all the other elements of fraud are met,which of the following statements,if false,could be used to support a fraud claim?

A) "This house should be able to withstand any wind Chicago can dish out."
B) "Before this house was redecorated,every room had very ugly wallpaper."
C) "Within 10 years,this house will be worth twice the price I am asking for it."
D) "The furnace was installed within the last five years."
E) "These window treatments I installed will still be in style in 2005."

Question 62

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?

Question 63

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:

A) a material statement of fact
B) fraud in the inducement
C) fraud in the inception
D) a statement of opinion

Question 64

Kevin disconnects the odometer on his car and then drives it for another 15,000 miles after which he decides to sell it.When Linda inquires about the vehicle,Kevin says "the odometer indicates the car has only 20,000 miles on it." Kevin's statement is:

A) a statement of opinion
B) an innocent misrepresentation
C) a material misstatement of fact
D) a material misstatement of opinion
E) a misrepresentation of law

Question 65

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) Fraud in the Inducement
B) Fraud in Inception
C) Fraud by Concealment
D) Unilateral Mistake

Question 66

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?

A) Donald can win on the basis of a mutual mistake of fact because both parties were wrong about thinking his love life would improve.
B) Donald cannot win on the basis of fraud because not all the elements of fraud are met.
C) Donald can win on the basis of unilateral mistake because he was the only one who really thought his love life would improve.
D) This contract is void as against public policy because someone named Donald should not be driving a Porsche.

Question 67

Bob sees a used car advertised as having 65,000 miles on it,the same as the odometer shows.Bob has the car inspected by a mechanic who says,"I think this car actually has about 100,000 miles on it,but it is in excellent condition." Frank buys the car and the engine fails a month later.Based on this,Frank:

A) cannot avoid the contract on the basis of fraud
B) can avoid the contract on the basis of unilateral mistake
C) can avoid the contract on the basis of undue influence due to the incorrect mileage
D) can recover from the mechanic on the basis of fraud

Question 68

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.

Question 69

If someone buys a piece of artwork which neither the buyer nor seller knows is a masterpiece,this is considered a mutual mistake of value.Can the seller rescind such a contract? If,however,a buyer and seller think the piece of artwork being sold is a particular masterpiece,but in fact it is not,this is considered a mutual mistake of fact.Can the buyer in this case rescind the contract? Why is the result different in these two situations? What is different about the two situations that would suggest that they have different outcomes?

Question 70

Bill sells some old books to Marion for a small sum of money.A few weeks later,Marion discovers that the books are quite valuable,worth as much as $50,000.Bill seeks to rescind the contract.What is the most likely result?

A) Bill may rescind the contract because of his unilateral mistake.
B) Bill may rescind the contract because of the bilateral mistake.
C) Bill may not rescind the contract because it is a mutual mistake of value.
D) Bill may not rescind the contract because more than three days from the date of purchase have elapsed.

Question 71

Why is there a requirement to prove reliance in order to recover for fraud? Why should the law not penalize a person who knowingly makes a false statement,regardless of whether the person to whom the statement is made can prove reliance? Would there be any practical problems if the reliance requirement were eliminated?

Question 72

Betsy told David about some wonderful development property that she owned in Florida.She offered to let him have a significant profit if he would invest in her development.After providing her with several thousands of dollars,David later discovered that there was no investment property in Florida.He should be able to state a claim of:

A) Fraud in the Inducement
B) Fraud in the Inception
C) Fraud by Concealment
D) Unilateral Mistake

Question 73

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.

Question 74

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?

A) This is a case of fraud,so the estate can rescind the contract.
B) This is a case of undue influence,so the estate can rescind the contract.
C) Unless Robert can prove that there was no undue influence,the contract can be rescinded.
D) This is not a case of undue influence because there is no fiduciary relationship.
E) Mrs. Smith is a competent adult and may dispose of her property in any way,and for any price she sees fit.

Question 75

Billy is out in the bars one hot August afternoon and runs into Carl Coach,who coaches the football team where he went to college.Billy invites Carl to join him for drinks,and they have the following conversation:
Billy: I need to talk to you about the upcoming football season.I need you to make sure that the football team wins each game by as much as possible.For each game that the team wins by at least 25 points,I'll give you $1,000.
Carl: I don't know if I can promise that.I don't know if any coach could.
Billy: Well,I'll even give you an extra $500 if it's by more than 35 points.
Carl: That sounds good.I can do that with this team.
Billy: Great! Here's to a good season!
And,they toast pitchers of beer.The team is undefeated that year,winning all but two games by more than 25 points and 3 of them by more than 35 points.The other two games were each won by 20 points.At season's end,Billy has paid nothing to Carl.Carl sues Billy for payment.Billy sues Carl to recover loses caused because of bets he placed in the two games won by only 20 points.Discuss the arguments that each has with respect to this agreement and the likely outcome.

Question 76

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.

Question 77

Neil owned a violin that he wanted to sell and Linda wanted to purchase.Both parties thought the violin to be a rare Stradivarius violin.They agreed on a price of $200,000.Later,it was discovered that the violin was just an ordinary violin,the value of which was only $10,000.Linda sues to recover her money.Discuss whether Linda is entitled to the return of her money or any other remedies.Fully discuss the legal theories involved.

Question 78

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.

Question 79

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.