Question

Bob wants to sell his deceased father's classic car. His father had told him numerous times the engine was all original. Bob knows very little about car engines and has no reason to doubt what his father told him. He lists the car for sale for $50,000 and justifies the price because the engine is all original. If later that turns out not be the case and the buyer sues, what state of mind will the court likely find Bob had at the time the statement was made?

a. Bob lacks intent or knowledge that the statement was true.

b. Bob lacks scienter.

c. Bob knew or should have known the statement was false.

d. A and b are both correct because they describe the same state of mind.

Answer 1

Option D

He listed price based on his father's words. He did not doubt his father.

His limited knowledge did not help him estimate the correct price of the car.

Bob's little knowledge about cars cannot justify the car's price.

Option A suggests that he did not have the required knowledge or had the intention of deceiving.

Option B suggests that he lacked scienter (the fact of an act having been done knowingly, especially as grounds for civil damages)

Option D selected because both statements are true and Option D justifies.