Question

Through fraudulent means, Finlay induces Ethel to sign a contract to in-vest with him the profits from her business. When Ethel learns the truth, she may

Answer 1

Rescind the contract

Step-by-step explanation:

Fraudulent action of Finlay leads the contract to become unenforceable. It’s a valid yet a defective contract between two parties. Thus, Ethel has the right to rescind the contract wherein she is not interested in the first place in the absence of Finlay’s deception. The court cannot compel Ethel to perform the agreement in the contract due to its defect. Yet Ethel can still cure the defect of the contract despite of the fraud and still exercise her rights towards profit of the business as stated in the contract they had.