Question

business law

1. Assume Eric enters a contract under each of the following circumstances. Which of them is void, rather than voidable?

• Doug grabs Eric's hand and physically compels him to sign a contract to buy his dog.

• Doug lies and tells Eric that his dog is a purebred, when it is actually a mutt, inducing Eric to buy the dog.

• Doug and Eric both believe that Eric is buying a breeding dog, when the dog is actually infertile.

• Doug believes that the dog is a purebred and tells Eric that, but it turns out it is a mutt and Eric overpaid.

• Eric buys Doug's dog, because Doug—who is Eric's boss—threatened to fire Eric if he didn't.

• 7. Which of the following is true about the relationship between mutual mistake and unilateral mistake?

• Unilateral mistake makes a contract voidable; mutual mistake makes it void.

• The elements are the same; the difference is only a matter of describing who is mistaken.

• Avoiding a contract based on unilateral mistake is easier than avoiding a contract based on mutual mistake.

• Unilateral mistake incorporates all of the elements of mutual mistake, except materiality.

• Unilateral mistake incorporates all of the elements of mutual mistake, plus an additional element.

• 8. Which of the following does NOT make a contract voidable?

• Lying to someone about the subject of the contract.

• Taking advantage of an elderly aunt to get her to sign a disadvantageous contract.

• Both parties are mistaken about an important aspect of the contract.

• Making a fair deal when one party making a mistake about the subject of the contract without the other realizing.

• Threatening to stab someone with a knife unless he signs a contract.

• 4. Meyer sells his drone to Ryland. The drone had crashed, Meyer fixed it by getting parts from other used drones. Ryland thinks the drone looks a little funny, and asks Meyer about it. Ryland says that he really needs a drone that is in mint condition. Meyer hears the question, but ignores it. Instead, he purposely distracts Ryland by pointing out a number of the great features of the drone. Ryland decides to buy the drone because he trusts that Meyer would not lead him astray. They are good friends. Under which consent defense could Ryalnd rescind the contract to buy the drone?

• Innocent misrepresentation

• Business compulsion

• Undue influence

• Unilateral mistake

• Fraud

• 5. Which of the following statements, if it turns out to be false, is most likely to give rise to a successful rescission claim of fraud or misrepresentation?

• "You should be able to sell this ring in a few years for a substantial profit."

• "Because the market is likely to move upward, you should buy this stock now at a low price."

• "If you buy this dishwasher from me, I guarantee you will be back in a month's time to thank me."

• "I believe that it would be hard to find a house of this age that is in as good of condition."

• "This car has only 40,000 miles on the odometer."

Answer 1

1. (Option c) Doug and Eric both believe that Eric is buying a breeding dog, when the dog is actually infertile.

Mutual mistake makes the contract void.

7. (Option a) Unilateral mistake makes a contract voidable; mutual mistake makes it void.

8. (Option c) both parties are mistaken about an important aspect of the contract

Mutual mistake makes the contract void, not voidable.

4. (Option c) Undue influence

Undue influence occurs when an individual is able to persuade other’s decisions due to relationship between the two parties.

5. (Option e) this car has only 40,000 miles on the odometer