Solution:
Let's break down why the correct answer is
Option A: This is fraud.
What is Fraud?
Fraud, in contract law, means intentionally deceiving someone to get them to enter into an agreement.
Key Elements of Fraud:
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False statement or concealment: There must be a statement that's not true, or important information hidden.
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Knowledge: The person making the statement must know it's false, or be recklessly indifferent to its truth.
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Intent to deceive: The person must intend for the other party to act on the false statement.
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Actual deception and damages: The other party must actually be deceived and suffer a loss because of it.
Why this scenario is fraud:
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A knows the horse is unsound: 'A' has knowledge that the horse is defective.
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A says nothing: By remaining silent about the horse's unsoundness, 'A' is concealing a crucial fact.
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Auction to his daughter: Selling to his daughter doesn't change the fact that he's concealing information. The relationship might even suggest a greater duty to disclose.
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Intent to deceive is implied: Since 'A' knows the horse is unsound and doesn't disclose it, it can be inferred that he intends to deceive the buyer (even if it's his daughter) into thinking the horse is sound.
Why other options are incorrect:
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Option B: This is not fraud: This is incorrect because 'A' is intentionally concealing a defect that he knows about, which fits the definition of fraud.
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Option C: This is misrepresentation: Misrepresentation is an untrue statement of fact. Fraud goes a step further and includes the element of intent to deceive. Since 'A' knows about the unsoundness and deliberately hides it, this goes beyond simple misrepresentation and becomes fraud. It involves intentional concealment which is the key difference from misrepresentation.
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Option D: None of these: Fraud is the appropriate answer in this case, so this is also incorrect.
Therefore,
Option A: This is fraud is the most accurate answer because 'A' intentionally concealed a known defect to deceive the buyer.
