Bus 311 Week 2 - D 1 & 2

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Discussion 1: Mutual Agreement a. Can the contract for sale be canceled because of fraud? Yes, Gortino had reckless disregard for the truth and knew his statement about the termites was false. Technically, Stein didn't even have to ask; what Gortino did was intentional concealment. b. Was there a misstatement of material fact? Yes, because it is information that influenced, in this case, the buyer into acting in a certain way or making a certain decision. c. Did Stein suffer a loss as a result of Gortino’s actions? There isn't enough information to decide if Stein suffered a loss. If she ends up having termites now or in the future, has to pay to eliminate the termites, or finds damage to the house due to previous termites, then yes. d. Can Stein sue for damages? If any of the things I've mentioned in question "c" happen, yes. Stein should sue. Alternately, if Stein wants to sue Gortino for fraud to cancel the sale or come up with a different settlement, she can do that. Discussion 2: How does this doctrine act as an exception to the elements and requirements of a contract? This doctrine can act as an exception because, according to Reinstatement Section 90, the promise doesn't have to be "so comprehensive in scope as to meet the requirements of an offer that would create a binding contract if accepted by the promisee" ("Hoffman v. Red," 1967). Also, the promissor has to expect that, upon the promise, it will induce action by the promisee. The promissor cannot say it wasn't part of the contract. Why does this doctrine exist? The doctrine exists to protect a person who was promised something and there is no essential elements of a contract that exists. Did the court reach the proper decision in the case you discussed? I think the court did reach the proper decision. The case was regarding a

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