Question 1

If an incident of misrepresentation is neither fraudulent nor negligent, yet it resulted in harm, then

Accepted Answer

Innocent misrepresentation, which is neither fraudulent nor negligent, typically does not qualify for a tort action, as torts generally require some level of fault or negligence.

Question 2

The meter maid gave Jim a parking ticket. But as it turns out, the NO PARKING sign had been placed in error on private property. Can Jim recover damages in a tort action?

Accepted Answer

Jim cannot recover damages in a tort action because there was no fraud or carelessness on the part of the meter maid. The meter maid acted based on the information available, and there was no intentional or negligent wrongdoing.

Question 3

Christi was told by the store's produce manager that the oranges were of a variety that had a extremely high level of vitamin C. So she bought a case for her health club's garden party. At the party, the guests enjoyed eating up all the oranges. When Christi was next in the store, the manager corrected his prior statement, saying the oranges were of a different variety than what he had thought. Does Christi have a legal claim for rescission?

Accepted Answer

D

Question 4

You innocently have made some misstatements that others are relying on. Legally speaking, you can change your situation from innocent misrepresentation into one of fraudulent or negligent misrepresentation by

Accepted Answer

If you do nothing upon learning the truth, your inaction can be seen as negligent or fraudulent, as you are allowing others to continue relying on false information.

Question 5

Terri asked to see the #378 Silver Streak tomato seeds listed in the catalog. The clerk pointed to a large bag in the corner and Terri commenced to weigh out the two pounds she wanted. Several weeks later, she discovered the plants were the wrong variety. Does she have a legal claim in misrepresentation?

Accepted Answer

Terri may have a legal claim in misrepresentation because actions can be a source of misrepresentation. In this case, the clerk pointed to a bag labeled as the #378 Silver Streak tomato seeds, which may have led Terri to believe they were the correct variety. However, it is important to note that the specific circumstances and evidence would need to be examined in order to determine if misrepresentation occurred.

Question 6

Jaime has agreed to buy Steve's 4x4 truck. When Steve used the truck last, it ran quite well, so he says "it is in good condition". Unfortunately, the truck sat in the humid weather for some time and the head gasket had rotted away to where the truck wouldn't run. What legally should Jaime do?

Accepted Answer

Jaime should demand rescission of the contract because the truck was not in the condition as described by Steve, which constitutes a misrepresentation of the truck's condition.

Question 7

Damages are not generally awarded in cases of innocent misrepresentation, however, "out- of- pocket" expenses might be awarded. These are referred to as

Accepted Answer

Compensation or indemnity is the most appropriate choice as it refers to the awarding of damages in cases of innocent misrepresentation. While trivial damages refer to a small amount of damages which may be awarded, an expense supplement, expense benefits, and rescission expenses are not commonly used terms for damages in cases of innocent misrepresentation.

Question 8

Tom buys a piece of land based on the innocent misrepresentation of a real estate agent. He can get rescission of the contract

Accepted Answer

Tom can get rescission of the contract up until the final closing date of the sale, as he was induced to enter into the contract based on a misrepresentation by a real estate agent. However, he may not receive damages unless he can prove that he suffered a financial loss as a result of the misrepresentation. The other answer choices are incorrect because there is no 48-hour time limit for rescission, rescission is not available after transfer of title, real property sales do not automatically result in damages for innocent misrepresentations, and the placement of a mortgage on the land does not affect the ability to get rescission for an innocent misrepresentation.

Question 9

Linda took out a new auto insurance policy. She signed without reading each of the papers presented to her by the agent. What she didn't realise is that the insurance only covered accidents on "public roads". This term in no way was brought to her attention nor explained. A few days later she got into a serious accident in a large housing development where the roads had not as yet been turned over to the municipality. The insurance company refused to pay the claim. Can Linda get damages under misrepresentation?

Accepted Answer

Linda may have a case for misrepresentation by omission if the agent did not inform her of the specific limitations of the policy. If the agent presented the terms in a way that was misleading or failed to fully disclose important information, then Linda could potentially seek damages. However, if the agent provided the terms in a clear and transparent manner, and Linda simply failed to read and understand them, then she may not have a case.

Question 10

Both rescission and damages are available remedies for misrepresentation only when the misrepresentation is

Accepted Answer

Both rescission and damages are available remedies for misrepresentation only when the misrepresentation is fraudulent or negligent. Innocent misrepresentations do not warrant either remedy.

Question 11

Misrepresentation in contract law

Accepted Answer

Misrepresentation in contract law usually renders the contract voidable at the option of the victim, meaning that the victim has the right to set aside the contract or seek damages. Misrepresentation can occur when a party makes a false statement of fact or fails to disclose material information that would have affected the other party's decision to enter into the contract. It is a type of fraud that goes to the core of the contract, as opposed to mere puffery or sales talk. Therefore, the best choice is E.

Question 12

The domination of one party over the mind of another to such a degree as to deprive the latter of the will to make an independent decision is

Accepted Answer

The definition given in the question best matches the concept of "undue influence." While the other answer choices may be related to certain aspects of the definition, they do not encompass the totality of what is described.

Question 13

If a party to an existing contract discovers they had made an incorrect statement during the contract negotiations, then they should

Accepted Answer

The party should inform the other party of the true situation as soon as possible to maintain transparency and honesty in the contractual relationship. This can help prevent any misunderstandings or legal disputes down the line.

Question 14

If a preliminary bargaining statement is expected to influence the decision of the other party, then it is said to be to the contract.

Accepted Answer

A preliminary bargaining statement that can influence the decision of the other party is considered material to the contract because it has a significant impact on the terms of the agreement. The other options (B, C, D, E) do not accurately capture the meaning and importance of a statement being material.

Question 15

If rescission is unavailable in a case of innocent misrepresentation, and the misstatement was an important inducement, and the aggrieved party has suffered substantial loss, the court may look at the misrepresentation as

Accepted Answer

The answer of If rescission is unavailable in a case...

Question 16

Brandy wants to buy a car. Her credit rating will not allow her to borrow from a bank, so she goes to a private lender. This lender asks her to sign a contract that has lots of restrictive terms, which he rushes by without explaining or allowing her to read. What is the issue?

Accepted Answer

The issue is misrepresentation by omission because the lender is not providing Brandy with the opportunity to understand the contract terms, which could lead to her being misled about the contract's nature.

Question 17

Cindy bought a car from Ben. Before she bought the car, her mechanic inspected it and told her it had a new engine. Cindy has now owned the car for two months, and has discovered that the engine is not new and will need to be replaced soon. Both Ben and the mechanic though that the engine was new. What remedies would Cindy most likely be entitled to?

Accepted Answer

The answer of Cindy bought a car from Ben. Before...

Question 18

If innocent misrepresentation exists, the party who relied on it, upon learning the facts, should

Accepted Answer

When innocent misrepresentation occurs, the party who relied on it has the right to renounce the agreement promptly upon learning the true facts. This allows for rescission of the contract and avoidance of any further obligations or harm. It is not appropriate to forfeit any claim to compensation or indemnity expenses, wait a reasonable length of time to respond, prepare a formal protest, or take any further benefits as these actions do not address the issue of the misrepresentation.

Question 19

Misrepresentation can affect the contract only if the misrepresentation is

Accepted Answer

Misrepresentation affects a contract when it is a false statement of fact, not opinion, as it can lead to a party being misled into entering the contract.

Question 20

Dot sold her land to Seth. Three weeks before making the contract, she told Seth the well on the property had a flow of 10 gallons per minute. Dot had obtained the information from a certified water surveyor. Two months after taking title to the property, Seth discovered that the flow in the well was only 1 gallon per minute. What remedy might Seth be entitled to from Dot?

Accepted Answer

The answer of Dot sold her land to Seth. Three...

Quiz 9: Grounds Upon Which a Contract May Be Impeached: Misrepresentation, Undue Influence, and Duress