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Law and Business Administration

Mary operated a small accounting business from her rural home. This gave her several advantages including lots of privacy from the prying neighbours and no issues around parking or noise. However, her rural Internet connection was always going down, which created problems especially around income tax filing season. Mary contacted several Internet providers, including Roberts Communications Inc. (“Roberts”) She spoke on the telephone with their representative, Stephen. Mary told Stephen that the reliability of her Internet connection was very important to her business and that was one of the key features she was looking for from an Internet service provider for her rural location. Stephen said to her in response, “Roberts has the most reliable 4G network in the province of Ontario.” Based on this conversation, Mary visited the Roberts kiosk at the local mall the next day. She signed up for a three-year data Internet plan with Roberts. The document she signed was long (
8 pages
) and it contained the following statement: “This agreement is the whole agreement between you and Roberts. There are no representations, conditions, warranties or other terms save and except for those contained herein.” The document said nothing in the 8 pages about the reliability of Roberts network. The next day, Roberts’ installer came to Mary’s rural home and hooked her up to the new Internet and T.V. system. A few weeks after getting the new system, Mary found that she was still frequently loosing her Internet connection, sometimes for several hours. When she called Roberts to complain, the representative explained to her that in rural areas sometimes the connections are not so reliable as in the urban areas. Mary is unhappy since it had cost her $500 to switch services and she was still having the same problems as before she switched. Mary did some investigating and found out that the claim of being the most reliable network was based on industry comparisons done in 2014 and was six years out-of-date. She also found out that the comparisons were based on performance only in urban areas (facts of case are loosely based on case problem from chapter 9 of J.E. Smyth et al., The Law and Business Administration in Canada, 14th ed. Toronto: Pearson Education). Questions: 1. Was the telephone statement by Stephen to Mary a misrepresentation? Please explain why or why not? Include in your answer a discussion of every requirement Mary would have to establish for the statement to qualify as a misrepresentation AND an explanation of why or why not on the facts each requirement for misrepresentation is established or not established (6 marks). 2. Can Roberts rely on the statement in the written document Mary signed at the kiosk to prevent Stephen’s pre-contractual statement from becoming a term of its contract with Mary? If so, how? If not, why not? Fully explain your answer by referencing the appropriate legal rule and explaining how it applies on the facts of the case


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