BA Test 4 - Chapter 13-Reality of Consent A....

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Chapter 13—Reality of Consent A. Misrepresentation I. Misrepresentation Definition: A false statement of fact; can only bring action for false fact Future Tense vs. Present or Past Tense Factual Statements—Past or present Opinion—Future tense Puffing or Sales Talk Arms Length Rule —not legally required to inform him about his own affairs; not required to instruct person you are making a deal with -This is because we like free enterprise and competition Types of Misrepresentation : Fraudulent Misrepresentation 1. Criminal and Intention kinds of fraud a. Express Lie —other party deliberately lies so you enter the contract b. Partial Information (Omission )—Relates to Arm’s Length Rule if you choose to talk, you have to tell the real story, you can’t leave information out c. Acts or Conduct —Concealment of defect by seller d. Non-Disclosure i. Exceptions: 1. Loyalty —Contract law (i.e. in real estate) 2. Health or Physical Safety —If you know someone in danger, you have a duty to inform them of this danger 3. Fraud —both intentional and criminal act a. Cannot commit fraud b. Best chance to sue someone in corporation 2. Damages -What can we recover? A . Rescission —Cancellation; deceived into buying defective product (can’t keep using defective item if asking for rescission) For rescission, you need to quickly elect what type of g=damage you are seeking to recover 1. Return and Recover Cost 2. Consequential —expense damages B. Affirmance and Damages —either keep driving the defective car or keep the item and sue from overcharge 1. Compensatory a. out of pocket b. loss of bargain i.e. paid $10,000, seller said worth $13,000; really worth $8,000, then: $10,000-$8,000=$2,000=out of pocket $13,000-$8,000=$5,000 (loss of bargain damage)
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1. Must prove liability 2. Must prove these damages (i.e. numerical value) 3. Burden of persuasion—persuade the jury for the larger amount of money C. Punitive - (in addition to other damages) “penalty damages” which are over and above (used as punishment) because of outrageous damages (i.e. the McDonald’s case where the lady sued for the hot coffee she spilled)
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BA Test 4 - Chapter 13-Reality of Consent A....

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