Memorandum

To: Tania Miller

A plaintiff must allege five elements in a complaint for fraud: (1) a material representation of
fact by the defendant, (2) made with knowledge of its falsity, (3) made with intent to deceive or
induce reliance, (4) reasonable reliance by the plaintiff upon the misrepresentation, and (5) loss
by the plaintiff as a proximate result of the misrepresentation [Foster v. Panera].

Our client, Williams Matter (“Mr. Williams”) was misrepresented and defrauded by various
statements made by Biggs (“Biggs”), owner of Automotive Center. An analysis of the statements
shows that Williams can have a cause of action for fraud under 2 statements made by Biggs.

Statement 1: Biggs had “found a notification from Dodge about a defect causing the gears to
grind down.”

Biggs misrepresented to Mr. Williams that there was notification from Dodge, when there was
actually none. This statement shows that Biggs intentionally made a false statement to Williams
in order to induce him to get the car repaired from Biggs. A representation is material if a
reasonable person would consider it important in deciding to enter into the transaction (Foster
v. Panera). Here, relying on Biggs’s representation, Mr. Williams got the rebuilt transmission
fixed in his minivan, although he had no intention of putting a rebuilt transmission in his
minivan. Mr. William relied on Biggs expertise in automobile repair and based on his statement
got the rebuilt transmission fixed in the minivan. As a result of the material misrepresentation,
Williams suffered a loss of $1887 for fixing the rebuilt transmission plus $128 what he had to
pay to Mission Dodge for getting the repair done from the damage caused by Biggs.

Statement 2: Biggs also told Mr. Williams, “Your transmission is going to fail, and soon!”

The determining question here would be, is this statement an mere expression of opinion or is
it a statement of fact? Fraud cannot be predicated upon the mere expression of an opinion
which is understood to be only an estimate or a judgment (Madison v. Brooks). The person to
whom such a statement is made has no right to reply upon the statement, and does so at his
peril. However, there is an exception to this rule, where the opinion relates to a subject as to
which the parties do not have equal knowledge or means of ascertaining the truth. Where the
party making the misrepresentation has special knowledge of the facts underlying the opinion,
or “is possessed of superior knowledge respecting such matters, with a design to design and
mislead,” the positive assertion of a matter, which stated in another form might be a mere
opinion, may be actionable if the statement was false. Here Mr. Williams had no knowledge
about the minivan and its transmission. He solely relied on the special knowledge of Biggs
about the statement of failure of the transmission. Biggs knew the statement was false and he
intentionally made the false statement to deceive Mr. Williams to induce him to get the rebuilt
transmission fixed in his minivan. Also as later told by Mission Dodge Biggs never changed the
original transmission in the minivan and did not replace it with a rebuilt one. But Biggs claimed
to Mr. Williams that he has changed the original transmission with a rebuilt one and charged
him $1887. We can compare our case facts with Madison v. Brooks where Madison relied upon
Brooks’s skill in the business and that Madison was not an expert in the field of Horticulture, did
not possess reasonable means of ascertaining the truth of Brooks’s statement. Likewise, Mr.
Williams solely relied on Biggs expert statement and he himself had no expertise in the field of
car repair, therefore had no reasonable means of ascertaining the truth of Biggs statement.
Similarly, as in Novotny v. Novotny and Wong v. Lumber, the plaintiff relied solely on the
expert advice of the seller and himself had no means of ascertaining the veracity of the said
statements.

Statement 3: “It would also help if we installed an extra cooler to keep it from running hot.”

Although this statement is false in order to induce Mr. Williams to install an extra cooler, but
Mr. Williams never believed or relied on the said statement. He told Biggs that if the minivan
had needed an extra cooler, the manufacturer would have installed one. As, Mr. Williams never
relied on Biggs statement, therefore, this statement would not be actionable.

Statement 4: “I guarantee the job.”

This statement can be a considered a promise made by Biggs. Here we need to determine
under what circumstances an unfulfilled promise to perform is actionable as fraud. A promise is
a statement of intention to perform some action in the future (Rogers v. Statewide Insurance
Co.). If the maker of the promise honestly intends to follow through on that intention at the
time of the promise, the statement cannot give rise to an action for fraud. However, if at the
time of making the promise the promisor has no plans to perform, he has misrepresented his
present intention, which would be a misrepresentation of fact. It is that misrepresentation that
can support an action for fraud. To state such a claim, one must specifically allege, among other
things, that the promisor did not intend to perform at the time the promise was made. In our
case, Biggs made a promise which he never intended to perform. As seen in the receipt, there is
a stamp of “No GUARANTEE”. Although Biggs made a promise that he guaranteed the job, he
never intended to fulfill that promise. When Mr. Williams inquired with Biggs about the
guarantee, he stated that because Mr. Williams elected not to have the extra cooler installed,
he could not guarantee the transmission. However, in the case facts, it’s clearly shown that
Biggs made the statement “I guarantee the job” after Mr. Williams declined to have the extra
cooler installed. Therefore, in the present circumstances, this statement can be a
misrepresentation supporting an action for fraud, if other elements of the fraud are proved.
Here we can argue that Mr. Williams paid the bill in entirety and when he left the shop, Biggs
made the statement about guarantee. It can be stated that Mr. Williams never relied on Biggs
statement of guarantee.

Causes of Action
 1. On June 5, 2008, Plaintiff Robert Williams called A-1 Automotive (A-1), owned and
operated by Defendant Aaron Biggs and spoke to Biggs to get oil change and fluid check
for his 2003 Dodge Minivan. After a test drive defendant told the plaintiff that there
might be a little slippage in the transmission and that A-1 would have to find what was
causing the problem. He further told the plaintiff that it could take time to detect the
problem, therefore defendant came back home leaving the minivan at A-1. Later the
defendant received a call from the plaintiff that there was a problem with the minivan’s
transmission and also told him that he has checked and found a notification from Dodge
about a defect causing the gears to grind down.
2. Defendant was aware that this was a false statement as there was no notification from
Dodge regarding the transmission.
3. The plaintiff expressly told the defendant not to take the transmission out and that he
was on his way to A-1. But when the plaintiff reached A-1, the defendant had already
taken the transmission out of the minivan.
4. The defendant told the plaintiff that “your transmission is going to fail, and soon!” The
defendant told the plaintiff to either get the transmission repaired for $1400 or
purchase a rebuilt transmission from A-1’s stock for $1700.
5. The defendant made the statement to the plaintiff with an intent to deceive him and to
induce him to purchase a rebuilt transmission from A-1.
6. The plaintiff had no expert knowledge of the car repair and relied solely on the expert
advice of the defendant believing it to be true.
7. Later on when the plaintiff took the repaired car home, he noticed that the minivan was
leaking transmission oil all over the garage.
8. Later when the plaintiff called the defendant and told him about the oil leakage, the
defendant said it was because he did not get the extra cooler installed in the minivan
and thus he cannot guarantee the transmission.
9. Later the plaintiff took the minivan to Mission Dodge, who told the plaintiff A-1 never
changed the original transmission and there is no rebuilt transmission fixed in the
minivan and also told the plaintiff that Dodge never circulated such notification
regarding problem with the transmission as stated by the defendant.
10. As a direct and proximate result of his reliance on the false statement made by the
defendant, the plaintiff suffered a loss of $1887, which he paid to A-1 for the rebuilt
transmission and a further expense of $128, which he had to pay to Mission Dodge,
because of the faulty repairs done by the defendant.

FINAL COMMENTS:

Your general law at the beginning of the memo laid a strong foundation to this MPT.

Overall, your analysis was strong and your conclusions were all correct. You weaved
relevant case law into your MPT and provided ample support for your
argument/conclusion! Your organization of the essay was on point. You also had a nice list
of causes of action (although in the future, please make a separate list of each COA)!

Remember to practice the MPT under timed conditions. Overall, excellent work here!

SCORE: 5

ABOVE PASSING