Question

Principle : Mere silence as to facts likely to affect the decision of a person to enter into a contract is not fraud.
Facts : A sells to B (A‘s daughter who is a minor) a horse which A knows to be unsound. A says nothing to B about the unsoundness of the horse.
This question consists of legal principle(s) (hereinafter referred to as ‘principle‘) and facts. Such proposition may or may not be true in the real and legal sense, yet you have to conclusively assume them to be true for the purposes of this section. Principles have to be applied to the given facts to arrive at the most reasonable conclusion. Only one of the alternatives, i.e., (A), (B), (C), or (D) is the most reasonable conclusion. In other words, in answering the following questions, you must not rely on any principle except the principles that are given herein below for every question. Further you must not assume any facts other than those stated in the question. The objective of this section is to test your ability in legal aptitude, study of law, research aptitude and problem solving ability even if the ’most reasonable conclusion‘ arrived at may be absurd or unacceptable for any other reason.

• A. A has committed fraud
• B. A has committed no fraud
• C. There cannot be a contract between a father and daughter
• D. The daughter did not ask therefore the father did not tell, hence no fraud

Answer 1

The Correct Option is B

The correct option is (B): A has committed no fraud.

Answer 2

The principle says that mere silence about a fact likely to affect a person's decision to enter into a contract is not fraud. A sold a horse he knew was unsound to B, his minor daughter, and said nothing about the unsoundness. Let's check each option.

1. Option A: A has committed fraud: Under the principle as given, silence by itself is never treated as fraud, so A staying quiet about the horse's condition cannot amount to fraud under this rule.
2. Option B: A has committed no fraud: A said nothing about the horse being unsound, which is exactly the mere silence the principle addresses. Since the principle states this kind of silence is not fraud, A's conduct fits directly within it.
3. Option C: There cannot be a contract between a father and daughter: The principle says nothing about family relationships preventing a contract, it only deals with silence and fraud, so this option is not supported by anything in the principle.
4. Option D: The daughter did not ask therefore the father did not tell, hence no fraud: The principle does not turn on whether the buyer asked a question, it turns simply on whether the seller stayed silent. This option reaches the right result but for a reason the principle never mentions.

A's conduct was mere silence about the horse's condition, and the principle treats mere silence, on its own, as falling short of fraud.

Therefore, the correct answer is A has committed no fraud.

Answer 3

Break this into a short test: identify exactly what A did, then check whether that conduct is mere silence or something beyond it, since only conduct beyond mere silence would fall outside the principle's protection.

1. A has committed fraud: This fails the test, A's conduct here is nothing beyond staying silent about the horse's condition, and the principle expressly says mere silence of this kind is not fraud.
2. A has committed no fraud: This matches the test exactly, A said nothing about the unsoundness, which is mere silence as to a fact likely to affect B's decision, and the principle places this outside fraud.
3. There cannot be a contract between a father and daughter: This does not engage the test at all, it raises a question about family relationships and contract formation that the principle, concerned only with silence and fraud, never addresses.
4. The daughter did not ask therefore the father did not tell, hence no fraud: This reaches the same result as the second option but through a different test, whether a question was asked, that the principle does not actually apply, the principle turns only on whether the seller stayed silent, not on whether the buyer inquired.

Testing A's conduct against the definition of mere silence, that is exactly what he did, and the principle places that outside fraud.

Therefore, the correct answer is A has committed no fraud.