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Exam 15: Mistakes Fraud and Voluntary Consent

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Question 21

True/False

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Only a mistake of value or quality makes a contract voidable.

A) True
B) False

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verified

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Question 22

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Generally, a contract will be set aside because certain pertinent information is not volunteered.

A) True
B) False

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Question 23

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When both parties to a contract are mistaken about the same material fact, a unilateral mistake has occurred.

Denis sells a motorcycle to Elton without disclosing that the odometer, which reads 10,000 miles, was disconnected 100,000 miles ago. Denis is most likely liable for

Ned threatens physical harm to force Omar to pay for "protecting" Omar's restaurant, Pasta Plates, from vandalism. Most likely, Omar may

Car Lot's salesperson Dirk offers to sell Espy, who is twenty years old, a car. Dirk intentionally misrepresents the vehicle's use and repairs. In reliance, Espy buys the car. To prove fraud, Espy does not have to show that

Bram, a salesperson for Cruisin' Motors, promises Dot a certain car will give her a "smooth ride." Bram offers a test drive, which Dot declines. She buys the car but soon realizes its suspension is in poor condition. Dot can rescind the contract on the ground of

A fact that is important and central to the subject matter of a contract is a material fact.

Even if the defects on a piece of property are obvious, the buyer can justifiably rely on the seller's misrepresentations concerning those defects.

If a contractor's bid was significantly low because he or she made a mistake in adding up the total estimated costs, any contract resulting from the bid is still normally enforceable.

Big Dig LLC makes an offer to perform an excavation and related tasks for Commercial Development Corporation, but due to a substantial mathematical mistake, significantly underprices the work. Commercial accepts the offer. Data Big's best defense against enforcement of the contract is that Commercial knew

Ewa is induced by her guardian Filo to sign a contract to invest funds in Gold Inc. through Filo's investment firm. Unknown to Ewa, Filo realizes a commission from the investment. Most likely, Ewa can rescind the contract on the basis of

If contracting parties attach materially different meanings to a contract word or term subject to more than one reasonable interpretation, the contract is void.

In the context of fraudulent misrepresentation, an opinion is objective and verifiable, whereas a fact is subject to debate.

A bilateral mistake occurs if one party to a contract is mistaken about a material fact and the other party knew or should have known that a mistake was made.

Analytics LLC processes misinterpreted data furnished by Botch Services to propose a marketing plan for Clientele Inc. Analytics and Clientele are both ignorant of the mistaken data. Their contract can be rescinded on the basis of

The essential feature of undue influence is that a party being taken advantage of suffers from a mental or physical impairment.

In selling a vacant building, Riley, a real estate broker, tells Saki that the property has a certain capacity, making it suitable for a nightclub. Riley knows nothing about the capacity of the building, but it is not as he specifies. Saki buys the building. Saki's best course of action is most likely to

Persuasion that induces a person to act according to the will of a dominant party is undue influence.

Dana believes that a new phone to be sold by Ear Fruit Inc. will become the most popular phone in the market. Dana enters into a contract to buy 500 shares of Ear Fruit stock, anticipating an increase in its value. The phone does not become popular, and the price of the stock does not rise. Dana can recover