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Exam 17: Legal Assent

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Question 31

Multiple Choice

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Which of the following was the result on appeal in the Case Opener involving the claim that Michael Jordan owed $5 million based on his agreement to pay the plaintiff's mother on the premise that he was the father, although it was later determined that the child was not his?

A) That the agreement to pay $5 million could only be rescinded based on a mutual mistake of fact.
B) That the agreement to pay $5 million could only be rescinded based on the mother's fraud.
C) That the agreement to pay $5 million could be rescinded based on either a mutual mistake of fact or based on the mother's fraud.
D) That the agreement to pay $5 million could not be rescinded because Jordan was aware of a question about his parentage.
E) That the agreement to pay $5 million could not be rescinded because Jordan waited too long in which to complain about the contract.

F) A) and E)
G) C) and D)

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Question 32

Multiple Choice

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[Elton's Electronics] Elton's Electronics sells electronic housewares. Elton is looking for a new supplier to produce the standard-sized switchplate for its best-selling blender. He contacts Porter and provides Porter with specifications for where the switches on the switchplate should be placed. Porter provides excellent pricing and delivery terms, which would save Elton a lot of money. Elton and Porter sign a contract for Porter to produce 10,000 standard-sized switchplates according to Elton's specifications. When the completed switchplates arrive, Elton's employees attach them to the blenders, however, the standard-sized switchplates are two millimeters too long. Elton is furious and calls Porter, who says Elton can send back the switchplates and Porter's company can rework them, but there will be a fee because the switchplates he shipped were "standard-size" switchplates, as specified in the contract. Elton disagrees and hangs up the phone. Elton's technician measures both the switchplates and the blender and discovers that the blender face where the switchplate is attached is two millimeters shorter than the well-known "standard-size" switchplate. The technician suggests they could shave off two millimeters from Porter's boards to make them fit on the blenders, however, it would be a lot of work. -Which of the following best describes Elton's situation?

A) Fraudulent misrepresentation, because Elton justifiably relied on a false statement by Porter.
B) Mutual mistake, because both parties were mistaken about the standard-size switchplates to be delivered under the contract.
C) Unilateral mistake, because Elton was mistaken about the size of the switchplates he needed for his blenders.
D) Duress, because Porter knows much more about the standard size for switchplates in the industry than Elton.
E) Negligent misrepresentation, because Porter should have known that the standard-size may not work for everyone.

F) A) and B)
G) B) and D)

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Question 33

Multiple Choice

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[Pet Pig Farm] Jen was interested in buying Monique's land in order to breed small pet pigs. Jen told Monique that having water on the property was very important although she did not mention to Monique her plan to breed small pigs. Monique assured her that a spring ran through one corner of the property. Therefore, Jen agreed to buy the farm. Jen, who loved pigs, assumed that the neighbors would be pleased with the pigs being in the area. Monique also agreed to sell Jen a used truck for $5,000. After the contract for the land sale was entered into, Jen had a land survey done, and it was discovered that the spring did not actually run through the corner of Monique's property. The area in which the spring ran belonged to a neighbor. Additionally, when Monique brought Jen the used truck, Jen said, "That's not the truck!" It was discovered that Monique, who had two trucks, thought that Jen had bought the older truck although Jen thought she had purchased the newer truck. Jen was also surprised when she received a petition signed by all surrounding landowners objecting to the presence of the pigs and threatening to sue Jen for nuisance. It will cost Jen more than she had agreed to pay Monique in order for Jen to obtain a similar farm that has a spring within its legal boundaries. -Which statement would be the result if Jen attempts to rescind the contract and recover damages only on the basis of the neighbors' objection to a pig farm?

Fraudulent misrepresentation is also referred to as intentional misrepresentation.

Renaldo thought that he was buying a car with air conditioning. The car did not have air conditioning. The mistake was the result of Renaldo not properly looking at the car. This is a[n] ________ mistake.

Mistakes in contract law result from untrue statements made by one party to the contract.

Manny and Oliver are negotiating for a new stereo system for Oliver's car. Manny tells Oliver that the new stereo system is state of the art with all of the appropriate certifications. Manny knew that the stereo system did not have the appropriate certifications but really wanted to make the sale. ________ occurred when Manny made the false statements about the certifications.

[Elton's Electronics] Elton's Electronics sells electronic housewares. Elton is looking for a new supplier to produce the standard-sized switchplate for its best-selling blender. He contacts Porter and provides Porter with specifications for where the switches on the switchplate should be placed. Porter provides excellent pricing and delivery terms, which would save Elton a lot of money. Elton and Porter sign a contract for Porter to produce 10,000 standard-sized switchplates according to Elton's specifications. When the completed switchplates arrive, Elton's employees attach them to the blenders, however, the standard-sized switchplates are two millimeters too long. Elton is furious and calls Porter, who says Elton can send back the switchplates and Porter's company can rework them, but there will be a fee because the switchplates he shipped were "standard-size" switchplates, as specified in the contract. Elton disagrees and hangs up the phone. Elton's technician measures both the switchplates and the blender and discovers that the blender face where the switchplate is attached is two millimeters shorter than the well-known "standard-size" switchplate. The technician suggests they could shave off two millimeters from Porter's boards to make them fit on the blenders, however, it would be a lot of work. -Which of the following statements is least likely to support the suggestion of Elton's technician about shaving down the switchplates and using them, instead of rescinding the contract?

Which of the following was the result on appeal in the case of Evan Rothberg v. Walt Disney Pictures, the case in the text in which the defendant allegedly used undue influence to obtain a release of employee benefits from a person in the hospital dying of AIDS?

Gloria makes a representation about a car on the showroom floor but actually has no knowledge as to whether her claim is false or not. Gloria does not have ________.

[Pet Pig Farm] Jen was interested in buying Monique's land in order to breed small pet pigs. Jen told Monique that having water on the property was very important although she did not mention to Monique her plan to breed small pigs. Monique assured her that a spring ran through one corner of the property. Therefore, Jen agreed to buy the farm. Jen, who loved pigs, assumed that the neighbors would be pleased with the pigs being in the area. Monique also agreed to sell Jen a used truck for $5,000. After the contract for the land sale was entered into, Jen had a land survey done, and it was discovered that the spring did not actually run through the corner of Monique's property. The area in which the spring ran belonged to a neighbor. Additionally, when Monique brought Jen the used truck, Jen said, "That's not the truck!" It was discovered that Monique, who had two trucks, thought that Jen had bought the older truck although Jen thought she had purchased the newer truck. Jen was also surprised when she received a petition signed by all surrounding landowners objecting to the presence of the pigs and threatening to sue Jen for nuisance. It will cost Jen more than she had agreed to pay Monique in order for Jen to obtain a similar farm that has a spring within its legal boundaries. -Assuming that Monique made a fraudulent misrepresentation regarding the spring running through the corner of the farm knowing the statement was not correct, which of the following is true, considering only the lack of a spring issue, if Jen does not want to go through with the sale?

A[n] ________ is a false representation of a material fact that is consciously false and intended to mislead the other party.

An erroneous belief about the facts of the contract at the time the contract is concluded is called a mistake of fact.

When the party making the statement would have known the truth about the fact had he used reasonable care to discover or reveal it, a negligent misrepresentation results.

Zara and Wahid have a lot of money invested with a stockbroker named Dion and also with other brokers. Zara and Wahid decided to divorce. Zara was really interested in investments, so the divorce decree provided that Zara would retain "all investment accounts," and Wahid would receive a "cash settlement" from funds the parties had in the bank. Six months after the divorce was final, it was discovered that Dion had absconded to parts unknown with all the money invested with him. Zara could have withdrawn the funds at the time of the divorce, before Dion left town, but she had no reason for concern and left the funds there for investment purposes. After discovering Dion's wrongdoing, Zara asked Wahid to renegotiate the divorce agreement, but he refused. Which of the following is the most likely result of their dispute if the court follows the decision of the court in Simkin v. Blank, discussed in the text?

Which of the following is an example of nondisclosure?

Ida and Kwame are both mistaken as to the content within their contract. This type of mistake that is shared by both parties to an agreement is a[n] ________ mistake.

Ben says he will sell Catalina a ring that he found in his yard. Ben and Catalina look at the ring and decide that they are not sure what it is, probably just a shiny stone. Catalina pays Ben $10 for the ring. The ring turns out to be a diamond worth much more than $10. Ben wants the ring back, and Catalina refuses. What is the most likely result?

Which of the following theories involve scienter?

Dalynda and Phillip have a contract that Phillip will play at Dalynda's opening night reception. The night of the concert, Phillip refuses to go on stage unless Dalynda agrees to pay an additional $5,000 for him to perform. This is known as ________.