ADMS 2610 Study Guide - Midterm Guide: Rescission, Toyota Electronic Modulated Suspension, Limited Liability Partnership
Course CodeADMS 2610
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ADMS 2610, SECTIONS B PRACTICE EXERCISES – PART 1
1. A retailer of digital watches wants to order new watches from their manufacturer for $50 per watch.
The manufacturer takes older watches; some do not work, repairs them and cleans them up making them
look like new. These watches are shipped to the retailer, who pays for them on delivery. On receipt of
the watches, the retailer immediately realizes that they are not new, but having advertised them for sale,
tries to fix them up without success. The retailer then contacts the manufacturer cancelling the contract
and asking for its money back, but the manufacturer refuses. Advise the retailer of its rights.
Fraudulent Misrepresentation- false statement by manufacturer that knew he wasn't selling new
watches; remedy: rescission + damages; contract: voidable on incident party decision.
Fundamental Breach- manufacturer failed to perform terms of contract; remedy: rescission + return
money; contract: voidable.
2. Give an example of the following:
(a) an invitation to treat Goods on a rack with price tags on them.
(b) an offer A offers to purchase B car for $500.
(c) a contract A and B enter into contract and agree on
3. Which of the following can be revoked by the offeror?
(a) an offer
(b) a contract
4. What is the difference between a mistake (whether mutual or normal unilateral) and
Mistake- without intention
Misrepresentation- statement of inducement
5. What is the test for frustration of a contract?
(1) Is performance possible? (2) Are both parties incident? (3) Can performance occur not w/ hardship?
6. An exclusion clause reads, “the carrier not liable for any damage to the owner goods.” The carrier is
negligent and the goods are damaged. Does the clause protect the carrier from damages?
Clause is not specific and does not protect carrier, it does not say damages caused by negligence.
7. A charitable organization seeks donations from the public. A wants to make donation to the
organization. Give an example of a donation that A would be bound to honour/make together with your
Donation small won’t bind person; only large donations that are relied upon will bind them.
8. At what stage in contracts would a party argue intention or capacity, before the contract or after it.
Provide your reasons.
After contract a party would argue intention or capacity, if only wanted to get out of contract.
Forms of Business:
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