Question 1

Lano owns a thirty six room motel on Route 49. Andre Preneur is interested in purchasing the motel. During the course of casual negotiations, Lano tells Andre

1)that the motel netted nearly $130,000 last year and

2)that it will net at least $145,000 next year. 

The motel books, which Lano turns over to her before any purchase agreement is reached, clearly show that Lano's motel netted only $115,000 last year. Also, Lano did not tell Andre that a bypass to Route 49 will redirect traffic away from the front of the motel. Andre purchases the motel. During the first year under Andre's operation, the motel nets only $118,000. It is at this time that Andre learns of the previous low profitability* of the motel(*compared to the statements made by seller) and the planned bypass. Andre wants her money back from Lano. (1) Should she get her money back? If yes, on what grounds and if not why not? (2) What information is a buyer entitled to and what information can seller withhold under similar circumstances as our buyer and seller find themselves? (3)Will Andre be able to present a clear case of fraud or misrepresentation with all the necessary elements of each cause of action?

Question 2

 Oscar offered to sell Steck a car and told Steck that the car had been driven only 45,000 miles and had never been in an accident. The odometer reads 45000 miles and may be broken. Oscar's father owned the car and died so Oscar doesn't actually know the true mileage. Steck hired a mechanic to appraise the condition of the car, and the mechanic said that the car probably had at least 70,000 miles on it and probably HAD been in an accident. In spite of this information, Steck still thought the car would be a decent value for the price, so he purchased it. Later when the car developed numerous mechanical problems, Steck sought to rescind the contract claiming Oscar was guilty of fraudulent misrepresentation of the car's condition. 

1. Discuss fully whether Steck should be able to rescind his contract? Be clear, specific in citing legal principles for your arguments for or against.