Sam Moore, an alert and intelligent 52-year-old businessman, tried without success to purchase a piece of farmland

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Sam Moore, an alert and intelligent 52-year-old businessman, tried without success to purchase a piece of farmland from Louis Wells. When he heard that Louis’s brother, James, was willing to sell his nearby farm, he went to see him at his nursing home to make an offer to purchase it. James was 62 years old, and unbeknownst to Sam, was suffering from brain damage. Sam offered to purchase the land for $7000. James signed an acceptance to the offer, and received a deposit of $100, without receiving any independent advice on the transaction. The land in question was worth quite a bit more than $7000—in fact, the farmer who was leasing James’ land at the time had offered to pay $14000 to $15000 for it just the year before. Since then, a trust company was appointed under the Mentally Incapacitated Persons Act, and took over the management of James’ affairs. The trust company refused to transfer the farm to Sam, who decided to sue in order to enforce the contract he entered into with James. Is the contract for the sale of the farm enforceable? If yes, does that seem like a just result? If not, what legal doctrine would likely be used to rescind it? If the contract is not enforceable, do you think that it is fair to Sam, who did not know about James’s mental state? Or is it reasonable to expect that he make sure that the person he is contracting with is mentally capable of entering into a contract? What factors ought Sam have taken into account?
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Canadian Business & the Law

ISBN: 978-0176501624

4th edition

Authors: Dorothy DuPlessis, Shannnon o'Byrne, Steven Enman, Sally Gunz

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