Part 3- Contracts, Chapter 13: Reality of Consent, Doc 4

Legal Analyses of the Case Scenarios: 6. Beachcomber Coins v. Boskett Issue: Can Beachcomber rescind the sale of the counterfeit dime based on mutual mistake? Analysis:     Mutual Mistake: Both parties believed the dime was genuine when entering the contract. Basic Assumption: The authenticity of the dime was a fundamental assumption underlying the sale. Material Effect: The counterfeit status renders the dime nearly valueless, significantly altering the agreed exchange. Risk Allocation: If neither party expressly assumed the risk of the coin's authenticity, rescission is likely allowed under mutual mistake principles. Conclusion: Beachcomber can likely rescind the contract due to mutual mistake. 7. Retailer v. Boy Issue: Can Retailer recover the Ernie Banks card sold at a mistakenly low price? Analysis:    Unilateral Mistake: Retailer’s intention was to sell the card for $1,200, not $12. Obvious Error: The price discrepancy is significant enough that the boy may have realized the mistake, making enforcement of the sale unconscionable. Good Faith: If the boy genuinely believed the card was priced at $12 without recognizing the error, the contract might stand. Conclusion: Retailer may recover the card if the mistake was obvious to the buyer. Otherwise, the sale may be binding. 8. Radford v. Keith Issue: Can Radford rescind the Note and Deed of Trust signed under duress? Analysis:   Improper Threat: Keith accused Radford of fraud and physically restricted her movement by stationing his associate at the door, creating significant coercion. No Reasonable Alternative: Radford’s only options were to sign the agreement or face costly legal proceedings, effectively removing any reasonable alternative. Conclusion: Radford should be able to rescind the agreement due to duress. 9. McCollams v. Cahill Issue: Did Cahill have a duty to disclose the presence of snakes on the property? Analysis:    Fraudulent Nondisclosure: If the presence of snakes materially impacts the property's value and was not disclosed, it could constitute fraud. Duty to Disclose: South Dakota law requires sellers to disclose all material facts. The disclosure form’s vague question on “other problems” could obligate Cahill to reveal the snake issue if significant. Evidence: However, the court found limited evidence of snake infestation during Cahill’s ownership, which weakens the fraud claim. Conclusion: Cahill may not have breached disclosure obligations if only a few snakes were present during his ownership and if he did not knowingly conceal material issues. 10. Stambovsky v. Ackley Issue: Can Stambovsky rescind the purchase contract because the house is reputedly haunted? Analysis:    Misrepresentation by Omission: Ackley failed to disclose the widely known haunting reputation, which could materially impact the property’s value. Buyer’s Justifiable Reliance: Stambovsky was unaware of the local reputation and relied on Ackley to disclose pertinent information. Unusual Circumstances: Given the unique nature of the "haunting" and its impact on property value, courts may view nondisclosure as fraudulent. Conclusion: Stambovsky has a strong case for rescission based on fraudulent nondisclosure, as the haunting reputation was well-known and Ackley failed to disclose it. 11. Nick’s Hideaway v. Dandey Corporation Issue: Can Nick’s rescind the lease due to zoning violations? Analysis:   Mutual Mistake or Misrepresentation: If both parties were unaware of the zoning violation (mutual mistake), rescission may be justified. However, if Dandey knowingly concealed the violation (fraud), Nick’s can also claim misrepresentation. Material Effect: The inability to operate the restaurant as intended fundamentally frustrates the lease’s purpose. Conclusion: Nick’s likely has grounds for rescission if they can prove mutual mistake or fraudulent misrepresentation.