Exam 15: Mistakes,fraud,and Voluntary Consent

Floramaria is an elderly woman who lives with her niece Galaxy.Floramaria is dependent on Galaxy for support.Galaxy advises Floramaria to "invest" in Galaxy's "professional gambling" venture,or Galaxy will no longer support her.Floramaria liquidates her other investments and signs a contract with Galaxy,to whom Floramaria gives the funds.Can Floramaria set aside this contract

Byron agrees to sell to Charity,for $1,500,a remote parcel of land.They believe the land to be worthless,but beneath it is a gold mine.Byron can

Fact Pattern 15-B2 (Questions B3-B4 apply) Organic Farms Company contracts to buy two tracts of land from Prime Bottomland,Inc.Both parties believe that the two tracts are adjacent,but in fact they are not.Prime Bottomland is still willing to sell the land,but under these circumstances the deal would adversely affect Organic Farms. -Refer to Fact Pattern 15-B2.The parties' belief about the adjacency of the property is

Fact Pattern 15-B1 (Questions B1-B2 apply) Digital Storage,Inc.,offers to sell provide cloud-computing services to Entrepreneur Enterprises,Inc.,but mistakenly transposes some of the digits in the price so that $15,400 appears in the offer as $14,500.Entrepreneur Enterprises accepts the written offer. -Refer to Fact Pattern 15-B1.Digital Storage's best defense against enforcement of the contract is that Entrepreneur Enterprises knew

Mona is induced by her guardian Newt to sign a contract to invest her student loan funds in Overseas Bank through Newt's investment firm.Unknown to Mona,Newt realizes ongoing commissions from the investment.Most likely,Mona may

At an auction for the first time,Dulcinea bids on a one-hundred-year-old Edison-brand phonograph,believing that it is worth more than the price asked.When the item proves to be less valuable,Dulcinea is

Voluntary consent may be lacking because of misrepresentation but not because of a mistake.

An innocent party can rescind a fraudulent contract and be restored to his or her original position.

Gene sells a trail bike to Hollis without disclosing that the odometer,which reads 10,000 miles,was disconnected 90,000 miles ago.Gene is most likely liable for

Courts typically set aside contracts because a party did not volunteer pertinent information.

Nora enters into a contract with Oceanic Transport,Inc.,to insure and ship a painting from France to the United States for a certain price.But Oceanic makes a mistake in adding the costs,which results in a contract price that is $1,000 less than the true cost.Most likely,a court would

Because fraud actions necessarily involve wrongful conduct,courts may award punitive damages.

In a bike shop,Barrie,who is not knowledgeable about bikes,overhears Cullen say,"This bike could win any race!" Barrie buys the bike,but does not win any races with it.Cullen's statement is

Scienter clearly exists if a party knows a fact is not as stated.

Duress is a defense to the enforcement of a contract,but not a ground for rescission of a contract.

To recover for fraud,a plaintiff must be twenty-one or more years of age.

Drake enters into a contract with Eve,who claims to have access to a stock-trading algorithm that will multiply an investment many times over.When the results do not match this promise,Drake learns that Eve does not have access to any unique software and files a suit against her,alleging fraud.Proof of an injury is required to

Fact Pattern 15-B3 (Questions B14-B15 apply) In selling a commercial building,Birdie tells Colt that the property has a certain capacity,making it suitable for a nightclub.Birdie knows nothing about the capacity of the building,but it is not as she specifies.Colt buys the building. -Refer to Fact Pattern 15-B3.Under these circumstances,Colt's best course of action is most likely to

Camille,a tennis pro,convinces Dante,who has no athletic ability,that he has considerable skill and induces him to pay Camille $1,000 for tennis lessons.When Dante realizes the truth,he files a suit against Camille.Dante is most likely to recover on the basis of

Fact Pattern 15-B2 (Questions B3-B4 apply) Organic Farms Company contracts to buy two tracts of land from Prime Bottomland,Inc.Both parties believe that the two tracts are adjacent,but in fact they are not.Prime Bottomland is still willing to sell the land,but under these circumstances the deal would adversely affect Organic Farms. -Refer to Fact Pattern 15-B2.Because of the parties' belief about the adjacency of the property,their contract is