Statement A: The action to claim rescission prescribes in four (4) years. Statement B: A relatively simulated contract may still be valid. Only Statement 'A' is false. Neither is f... Statement A: The action to claim rescission prescribes in four (4) years. Statement B: A relatively simulated contract may still be valid. Only Statement 'A' is false. Neither is false. Only Statement 'B' is false. Both statements are false.
Understand the Problem
The question is testing the truthfulness of two statements regarding legal contracts and claims. It presents multiple choices to determine which statement(s) may be false.
Answer
Only Statement A is false.
Statement A is false, and Statement B is true. The action to claim rescission generally prescribes in four years only for nullity and voidable contracts. A relatively simulated contract may still be valid depending on the underlying true agreement.
Answer for screen readers
Statement A is false, and Statement B is true. The action to claim rescission generally prescribes in four years only for nullity and voidable contracts. A relatively simulated contract may still be valid depending on the underlying true agreement.
More Information
Rescission is a remedy where the contract is canceled, and the parties are restored to their original positions. However, not all contracts are subject to rescission. A simulated contract is one where the contract's declared intention is false while there is a concealed true intention that may still be enforceable.
Tips
Confusing the general limitation period for rescission across all contract types creates an error. Correct identification of simulation types and their implications on validity is vital.
Sources
- void-or-inexistent-quia.pdf - Course Hero - coursehero.com
- Defective-contracts.docx - Course Hero - coursehero.com
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