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) The cause of action could be for the tort of deceit, if there was evidence that Mrs. Sharp intended to deceive them.
B) The court could not award the equitable remedy of rescission if evidence showed that Mrs. Sharp really believed the invoices were accurate.
C) The court could award the equitable remedy of rescission if the evidence showed she had fraudulently misrepresented the costs.
D) The court could terminate the contract for breach of contract if the accurate statement of costs and profit were essential terms of the contract.
E) The court could not award the equitable remedy of rectification because the argument is not about rectifying an erroneous written version of a previous oral contract.

Question

Quizplus · Accepted Answer

The court could still award the equitable remedy of rescission even if evidence showed that Mrs. Sharp believed the invoices were accurate. This is because the misrepresentation would still have induced the Morissons to enter into the contract, and therefore they would be entitled to the remedy of rescission to undo the contract.

Mrs Sharp, the Owner of a Restaurant, Induced the Morissons