Question

Mona is induced by her guardian Newt to sign a contract to invest her student loan funds in Overseas Bank through Newt’s investment firm. Unknown to Mona, Newt realizes ongoing commissions from the investment. Most likely, Mona may

a. not rescind the contract.
b. rescind the contract on the basis of undue influence.
c. rescind the contract on the basis of mistake.
d. rescind the contract on the basis of unconscionability

Answer 1

B: rescind the contract on the basis of undue influence.

Step-by-step explanation:

The fact that Mona has a guardian infers that this is someone she could trust for at least her financial issues, and because this person has used his or her advantage position and knowledge, and they relationship as well, to induce her to sign a contract she didn't understand fully, she can resort to a contract rescission on basis of undue influence.