Mark fails to reveal a material fact in a business deal with Nancy. This constitutes fraud if
A) Mark is not aware of the fact or his failure to reveal it.
B) the amount of consideration is grossly inadequate.
C) the fact concerns a serious defect known to Mark but not to Nancy.
D) any of the choices.

Question

Mark fails to reveal a material fact in a business deal with Nancy. This constitutes fraud if
A) ​Mark is not aware of the fact or his failure to reveal it.
B) ​the amount of consideration is grossly inadequate.
C) ​the fact concerns a serious defect known to Mark but not to Nancy.
D) ​any of the choices.

Quizplus · Accepted Answer

The fact that Mark failed to reveal concerns a serious defect that he knows about but Nancy does not. This is because fraud requires a material misrepresentation or omission, which must be made with knowledge of its falsity or reckless disregard for the truth, and which induces another party to act to their detriment. In this case, Mark's failure to reveal a serious defect falls under a material omission, which would constitute fraud.

Mark Fails to Reveal a Material Fact in a Business