Asked by Wendy Thurmond on Jun 14, 2024
Verified
Is Ky correct in claiming that the mistake in the division of the accounts is material?
A) Yes, if it was a basis for Ky's agreeing to enter into the contract.
B) No, because the mistake was in the financial information.
C) Yes, because only one party must show that the mistake was not what was intended.
D) Yes, because Ky made a mutual mistake.
E) No, because the mistake is not mutual since only Ky, and not Roland, was adversely affected.
Material Effect
An impact significant enough to influence a decision, action, or the outcome of a situation, often used in legal and financial contexts.
- Comprehend the notion and consequences of mutual errors in contractual agreements.
Verified Answer
SM
sandra mercardoJun 15, 2024
Final Answer :
A
Explanation :
A mistake is considered material if it goes to the basis of the agreement. In this case, the equitable division of accounts was a fundamental basis for Ky's agreement to the contract. Since the division was not as intended due to outdated financial information, the mistake directly affected the terms Ky believed he was agreeing to, making it material to the contract's formation.
Learning Objectives
- Comprehend the notion and consequences of mutual errors in contractual agreements.