Asked by Bryce Burns on Jun 18, 2024
Verified
Identify whether the following statements could result in actionable fraud and why or why not.
a. A statement by an art dealer to a potential buyer, "I think this painting is underpriced because the artist is now gaining national recognition."
b. A vacuum cleaner salesperson's statement, "This machine is the best available for the cost."
c. A city councilman's statement to a fellow councilman that, "If we vote for that action, the resulting consolidation will be illegal."
Actionable Fraud
A deceptive act that intentionally misleads or deceives another party, causing them harm, and is serious enough to provide grounds for a lawsuit.
Underpriced
Referring to an item, asset, or security that is available for sale at a price believed to be below its inherent or market value, often used in the context of financial investments.
National Recognition
The acknowledgment by a country or organization of another's status, rights, or conditions, often relating to sovereignty or quality standards.
- Apprehend the criticality of essential facts when proving fraud in the inducement.
Verified Answer
b. This statement is merely "puffing" or sales talk and would not result in actionable fraud.
c. Historically, courts held that representations of law were statements of opinion rather than fact. Presently a statement of law may have the effect of a statement of either fact or opinion. If the statement is to the legal consequences of a set of facts, it is considered a statement of opinion and probably not actionable.
Learning Objectives
- Apprehend the criticality of essential facts when proving fraud in the inducement.
Related questions
Which of the Following Is True Regarding Electronic Signatures ...
When a Party Signs a Negotiable Instrument Without Knowing That ...
Bruce,who Works for Laura's Used Car Dealership,forges Laura's Name to ...
Banking Problems ...
In the Context of Holder-In-Due-Course Status,explain What a Personal Defense ...