Bussniess law homework

1.

Nelson died in 1996 and Newman and Franz were appointed co-personal representatives of her estate. Newman and Franz hired McKenzie-Larson to appraise the estate’s personal property in preparation for an es- tate sale. McKenzie-Larson told them that she did not appraise fine art, and that if she saw any, they would need to hire an additional appraiser. McKenzie-Larson did not report finding any fine art, and relying on her silence and her appraisal, Newman and Franz priced the personal property and held an estate sale. Rice re- sponded to the newspaper advertisement for the sale and attended it. At the sale, Rice bought two oil paint- ings for $60. Rice had bought and sold some art, but he was no expert. He had never made more than $55 on any single piece and he had bought many that turned out to be frauds, forgeries, or the work of lesser artists. He assumed that the paintings at the estate sale were not originals, given their price and the fact that the sale was being managed by professionals. Subsequently, Rice learned that the paintings were original works of Martin Johnson Heade. Rice sold the paintings on consignment at Christie’s in New York for $1,072,000. After subtract- ing the buyer’s premium and the commission, Rice real- ized $911,780 from the sale. Newman and Franz sued Rice, claiming that the sale contract should be rescinded on the basis of mistake. Will Newman and Franz win?

6.

Boskett, a part-time coin dealer, paid $450 for a dime purportedly minted in 1916 and two additional coins of relatively small value. After carefully examining the dime, Beachcomber Coins, a retail coin dealer, bought the coin from Boskett for $500. Beachcomber then re- ceived an offer from a third party to purchase the dime for $700, subject to certification of its genuineness from the American Numismatic Society. That organization la- beled the coin a counterfeit. Can Beachcomber rescind the contract with Boskett on the ground of mistake?

7.

Retailer opened a baseball card store in vacant prem- ises next to an existing store. The card shop was very busy on opening day, so Retailer got a clerk from the adjacent store to help out. The clerk knew nothing about baseball cards. A boy who had a large baseball card collection asked to see an Ernie Banks rookie card, which was in a plastic case with an adhesive dot at- tached that read “1200.” The boy asked the salesclerk, “Is it really worth $12?” The salesclerk responded, “I guess so,” or “I’m sure it is.” The boy bought the card for $12. In fact, the true price intended by Retailer was $1,200. Can Retailer get the card back from the boy?

10.

Stambovky, a resident of New York City, contracted to buy a house in the Village of Nyack, New York, from Ackley. The house was widely reputed to be pos- sessed by poltergeists, which Ackley and members of her family had reportedly seen and reported to both Reader’s Digest and the local press. In 1989, the house was included in a five-home walking tour of Nyack and described in a newspaper article as a “riverfront Victorian (with ghost).” Ackley did not tell Stam- bovsky about the poltergeists before he bought the house. When Stambovsky learned of the house’s repu- tation, however, he promptly sued for rescission. Will he be successful?