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There are four (4) claims that may make a contract unenforceable, based on Fraud

ID: 356899 • Letter: T

Question

There are four (4) claims that may make a contract unenforceable, based on Fraud; Mistake; Duress; or Undue Influence. For each of the following, explain whether the contract would be enforceable, including whether it's void or voidable:

Your elderly neighbor who knows nothing about cars sells you her 1965 Mustang that's been sitting in her garage since her husband died 20 years ago. The only thing she knew about the car was that it was red. You later find out that the original engine has been replaced with a 4 cylinder, and that your dream muscle car is really a granny car. Did your neighbor defraud you? Misrepresent the sale? Was it a mistake? What's the remedy?

Same facts as above, except you asked about the engine in advance, and your neighbor said she checked and her mechanic told her it was the original engine. Did your neighbor defraud you? Misrepresent the sale? Was it a mistake? What's the remedy?

Same facts as above, except your neighbor allowed you to take the car to a mechanic to find out what kind of engine it had. The mechanic told you and your neighbor that it was the original engine. You later find out that the mechanic was wrong, and it's a replacement engine. Did your neighbor defraud you? Misrepresent the sale? Was it a mistake? What's the remedy?

Same facts as above, except the engine was exactly what you expected. But sadly, two days later the engine blew up. Did your neighbor defraud you? Misrepresent the sale? Was it a mistake? What's the remedy?

Explanation / Answer

In the first situation the neighbour does not defraud you as she never said anything about the engine and only knew that the car was red in colour. It was your responsibility to check your engine before buying the car. This is a clear mistake and possible remedies to talk with the granny for taking the car back and return the money, legally it is not possible to enforce the contract as the decision was yours while buying the car.

In the second situation it is a misrepresentation of the sale as neighbour confirm that the engine was original but it was not original in this is specific situation contract could be enforced on the seller. Best remedy would be the refund amount as the seller has misrepresented the sale. If the seller does not agree to refund amount then Court would decide the best option available.

In the third situation it is also miss representation of the sale by The Mechanic in this specific case seller is not responsible. Best remedy available for this situation is forcing the contract on the basis of false information provided by the mechanic. Mechanic can also not be held liable in this is specific situation as he could also be confused in determining the engine type.

The last situation if the engine blew up then there is no type of contract that could be forced in this situation. If the car is bought on the contract then there is no warranty for the specific issue and there is no enforcement of the contract for this situation and the buyer cannot claim anything.