BACHELOR OF BUSINESS ADMINISTRATION

Detailed explanation-1: -Material facts are important facts that influence the parties’ decisions about a contract. In some states, the contract is still valid if the mutual mistake is about the applicable law. Unilateral mistakes create the right to rescind or void the contract. All persons are presumed to know the law.

Detailed explanation-2: -A mutual mistake occurs when both parties have an erroneous belief while a unilateral mistake only involves the misunderstanding of one party.

Detailed explanation-3: -Which of the following is true regarding the effect of an innocent misrepresentation on a contract? It permits either the party that was misled by the false statement or the party who made the false statement to rescind the contract, and it also makes the contract void and of no effect.

Detailed explanation-4: -Misrepresentation of a material fact can occur by words or action. To recover for fraud, a plaintiff must be twenty-one or more years of age. Reformation occurs when a court alters the terms of a contract to reflect the true intent of the parties. Misrepresentation of a material fact is an element of fraud.