Dix agrees to sell Eli, for $1,500, a remote parcel of land. They believe the land to be worthless, but beneath it is shale rock containing oil. A court would
A) not rescind the contract.
B) rescind the contract on the basis of fraud.
C) rescind the contract on the basis of mistake.
D) rescind the contract on the basis of undue influence.

Question

Dix agrees to sell Eli, for $1,500, a remote parcel of land. They believe the land to be worthless, but beneath it is shale rock containing oil. A court would​
A) ​not rescind the contract.
B) ​rescind the contract on the basis of fraud.
C) ​rescind the contract on the basis of mistake.
D) ​rescind the contract on the basis of undue influence.

Quizplus · Accepted Answer

The contract would not be rescinded simply because both parties were unaware of the land's true value due to the oil beneath it. This situation does not constitute fraud, mistake in the terms of the contract, or undue influence, but rather a mutual ignorance of a material fact that does not affect the validity of the agreement.

Dix Agrees to Sell Eli, for $1,500, a Remote Parcel