Ralph Enters into a Contract with Skye to Buy Her

question 58

Multiple Choice

Ralph enters into a contract with Skye to buy her land based on her assertion that the land is open to development. After the sale, Ralph learns that only a small section of the land can be built on-a local law prohibits construction on the rest of the property. Ralph can​

• A) ​not avoid the contract because persons are assumed to know the law.
• B) ​avoid the contract due to a mutual mistake.
• C) ​avoid the contract due to a mistake in value.
• D) ​avoid the contract due to fraud.

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Definitions:

Accounting

A review and listing of all partnership assets and/or profit.

Distribution to Partners

Refers to the distribution of profits, income, or assets from a partnership to its partners, typically in proportion to their ownership interests.

Managing Partner

A member of a partnership who has the authority and responsibility for managing the everyday operations of the business.

Partnership Assets

Assets or property owned jointly by partners in a business partnership, used for the business’s operations.