1. Yes. The salesperson making the statement that there were no prior wrecks did not know whether that statement was true or false. Nevertheless, the salesperson made the statement as though it were true and as though he knew it were true. This constituted reckless indifference as to whether the statement was true. This is not mere negligence. This reckless indifference as to the truth of a statement satisfies the mental state element of fraud. The salesperson was therefore guilty of fraud. This salesman did not take any steps at all to find out if the car was in an accident. He just said NO to make the sale. 2. Yes. In a state like Connecticut that follows the common law rule, neither the damage to the property nor Helen’s misrepresentation of her age will prevent her from avoiding the contract. Some states would hold that because of the misrepresentation of age, Helen must pay for the damage that she has done, but she can avoid the contract. A few states would hold that Helen cannot avoid the contract because she misrepresented her age. Connecticut is a traditional
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This note was uploaded on 02/29/2012 for the course BUSINESS 101 taught by Professor Monastersky during the Spring '10 term at Bergen Community College.