– Lower court dismissed her complaint entirely stating that it failed to state a cause of action.
– Appellate court remanded the case for judgment and that there were facts to back it up.
– Feb 10th, 1961 – Vokes, a 51 year old widow wanted to become a dancer for “new interest in life” – went to Arthur Murray to get lessons and thereupon was sold 8 ½ hour lessons for $14.50 paid in cash.
– While she was there she was receiving false statements to her progress and how good that she supposedly was.
- Less than 16 months later – sold 14 dance courses for (2302 hours) for $31,090.45
- Went beyond legally permissive perimeter of “sales puffing” and intruded into the area of undue influence.
- Suggestion of false hood, suppression of truth, free exercise of rational judgment.
- She was influenced unwittingly, by barrage of flattery, false praise, excessive compliments.
- Not only inequitable but unconscionable to allow such contracts to stand.
- Additional lessons would make her more beautiful.
- Kept on signing on more lessons even though she had 100’s of un-used lessons already.
- 14 separate contracts.
- Murray kept on telling her how good she was even though she was terrible.
– Defendant argues
- Contracts can only be rescinded for fraud or mis-representation when the alleged misrepresentation is to a material fact, rather than an opinion.
– Does a mis-representation always have to be on of fact, versus one of opinion?
– NO- it does not always have to be fact.
– Generally a miss-representation to be actionable must be one of fact rather than opinion
- This rule does not apply to
- Where there is a fiduciary relationship between the parties.
- Some trick employed by the representor.
- Or parties, in general, do not agree at arm’s length.
– When a party has superior knowledge, it may be regarded as a statement of fact although it could be considered an opinion on equal playing fields.
– It can be inferred that the defendant had superior knowledge to the plaintiff.
- It should have been apparent to the defendant that her vast outlay of cash for the many 100’s of additional hours of dance class was not justified by her slow and awkward progress, which she should have been well aware of if they had spoken the whole truth.
- Even if parties do not have to disclose the whole truth, the law has a duty to disclose the whole truth.
- Plaintiff entitled to her day in court.
– Reversed – the plaintiff, based upon the facts, should be allowed to be heard in court.