Business Law Chapter 15 True & False
Generally, a unilateral mistake affords the mistaken party a right to relief from the contract.
False
Misrepresentation can occur by words or actions, but not by silence.
False
Misrepresentation of a material fact cannot occur through conduct alone.
False
The element of justifiable reliance requires the misrepresentation to be the sole factor in inducing the deceived party to enter into the contract.
False
To recover for fraud, a plaintiff must be twenty-one or more years of age.
False
Voluntary consent may be lacking because of misrepresentation but not because of a mistake.
False
Because fraud actions necessarily involve wrongful conduct, courts may award punitive damages.
True
In some states, the courts prefer to rely on traditional notions of fraud, undue influence, and duress rather than the concept of unconscionability.
True
Many courts have broadened the concept of unconscionability to apply it in situations other than sales of goods.
True
Scienter clearly exists if a party knows a fact is not as stated.
True
When the dominant party in a fiduciary relationship benefits from that relationship, a presumption of undue influence arises.
True
Words or terms in contracts that are subject to more than one reasonable interpretation can lead to bilateral mistakes.
True
A negligent misrepresentation is not a basis for rescinding a contract.
False
A unilateral mistake is a mistake made by both parties to a contract.
False
An innocent party does not need to suffer an injury to collect damages as a result of a misrepresentation.
False
Any party who does not receive what he or she considers a fair bargain can argue mistake.
False
Courts typically set aside contracts because a party did not volunteer pertinent information.
False
Duress is a defense to the enforcement of a contract, but not a ground for rescission of a contract.
False
A material fact is a fact that a reasonable person would consider important when determining his or her course of action.
True
An innocent party can rescind a fraudulent contract and be restored to his or her original position.
True