A fraudulent misrepresentation which induces another person to enter into a contract can result in which of the following remedies?
A) Rectification
B) Rescission and/or damages
C) There is no remedy available for fraudulent misrepresentation.
D) Damages only
E) Rescission only

Question

Quizplus · Accepted Answer

When a fraudulent misrepresentation is made and induces another person to enter into a contract, the innocent party may be entitled to the remedies of rescission and/or damages. Rescission allows the innocent party to cancel the contract and return to the position they were in before entering into the contract. Damages are an alternative remedy that compensates the innocent party for any losses suffered as a result of the fraudulent misrepresentation. Rectification may be available in cases where the contract is not void but defective, but it is not relevant to cases involving fraudulent misrepresentation alone. Option C ("there is no remedy available for fraudulent misrepresentation") and D ("damages only") are incorrect because there are at least two remedies available, as explained above. Option E ("rescission only") is also incorrect because the innocent party may be entitled to damages as well.

A Fraudulent Misrepresentation Which Induces Another Person to Enter into a Contract