Ontario Mortgage Agent Practice Exam

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Prepare for the Ontario Mortgage Agent Exam. Study with comprehensive quizzes, multiple-choice questions, and hints that enhance your understanding of mortgage regulations and practices in Ontario. Get ready to succeed in your mortgage agent licensing journey!

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What impact does misrepresentation have on a contract?

The contract will be canceled and parties will be restored to their pre-contract states
The contract terms will be renegotiated by the court
The parties must continue to fulfill the contract despite the misrepresentation
The court will intervene to enforce the misrepresentation terms

The correct answer is: The contract will be canceled and parties will be restored to their pre-contract states

Misrepresentation occurs when one party provides false or misleading information that influences the other party's decision to enter into a contract. In such cases, the contract can be voidable, meaning the party who was misled can choose to cancel the contract and revert back to their original position before the contract was made. This is why option A is correct. Option B is incorrect because the court will not typically renegotiate the terms of a contract due to misrepresentation. Instead, they will allow the party who was misled to cancel the contract. Option C is incorrect because the party who was misled is not obligated to continue fulfilling the contract if they choose to cancel it. Option D is incorrect because the court's role in cases of misrepresentation is to determine if the contract is voidable or not, not to enforce the terms of the misrepresentation.