Adams v. Adams

OPINION

MATTHEWS, Justice.

The power to avoid a contract due to misrepresentation can be lost if a party knowing or having reason to know of the misrepresentation affirms the contract. But this rule only applies in cases of non-fraudulent misrepresentations. Where there is fraud the power of avoidance is only lost if the party actually knows of the misrepresentation and affirms the contract. The main question in this case is whether, in the process of negotiating a lease, changing a right of first refusal to an option to purchase without notice should be considered a constructive fraud for…