MGT611 - Business & Labor Law

SEMESTER FALL 2023

Assignment # 1
Bc230423642

ABC conceals the fact that a property has severe structural damage and sells it as being in
excellent condition to induce XYZ (buyer). The buyer relies on this false information and
purchases the property, Later on, he discover the deceit. This is not a valid contract as it is
not meeting a condition of free consent to the parties. Identify that condition and comment
on it.

"Undue influence" is the unfulfilled free consent condition in this example. This occurs
when one side misuses their power, making it hard for the other side to make independent
decisions. Here ABC hid major structural damages of the property and misrepresented its
condition to make XYZ buy it. This is undue influence. So, the contract isn't valid because
there wasn't free consent. And XYZ has the right to cancel the contract.

A teacher asked his student to sell his car for an unreasonably low price in exchange for
promising full marks in the final examination. Is this a legal contract? Explain with reason
in either case.

According to the scenario a teacher tells a student to give up his car for a very low price
and in return guarantees perfect grades on the final test. This story rings alarm bells about
unjust power, as the teacher stands in a bossy position over the student. Unjust power pops
up when an individual in a higher spot misuses someone in a lesser spot, leading to the
weaker person's difficulty to freely use their own choice. Hence, this deal isn't legal, as it
could be viewed as cancellable due to the existence of unjust power. The student would
have the option to cancel the deal and look for legal help against the teacher for going along
with such behavior.

Mr. Y bought a horse from Mr. X for Rs. 200,000. Mr. X claims the horse can be used on
the farm. It revealed that the horse is lame and Mr. Y cannot use him on his farm .Here Mr
X. knowingly deceived Mr.Y .Is this Legal contract? Why or why not?

So, Mr. Y and Mr. X signed a contract. It centered on a horse. This contract isn't legal
though. Seems Mr. X tricked Mr. Y. He claimed the horse could labor on a farm. However,
that horse couldn't work at all. Now, that's an issue. They call it "fraudulent misreprese-
ntation." It's a fancy term for lying to get someone, like with a contract. In this case, Mr. X
lied. He was dishonest about the horse. This lie made Mr. Y buy the horse. Sadly, he lost
money on it. Thus, the contract isn't legal. Mr. Y can actually sue Mr. X for his lies,
wanting contract cancellation.

An employer exercises his influence over his employee so as to enter into a contract or
agreement by compelling him to accept the terms and conditions which are not otherwise in
his favor would lead to an agreement caused by use of undue influence. What is the legal
status of this contract?

A contract signed under pressure can be legally cancelled. Undue influence happens when
a boss manipulates an employee into signing a deal that isn't beneficial for them. This type
of pressured agreement isn't legally valid. If a boss behaves this way, the affected employee
can end the deal and sue them. Courts usually suspect undue influence unless the higher
ranking party can show the lower ranking party entered into the contract willingly. As a
result, the party that was affected by the use of unfair influence may void the contract,
which has no legal force behind it.