Use this fact situation to answer the related questions that follow it. Marvin is an investment counsellor.Alice is one of Marvin's clients.Alice has no investment experience and relies on Marvin's advice in making her investments.Last night,while he was sleeping,Marvin had a dream that the shares of Very Big Company (VBC)would go up a great amount in value.As a result,without even checking to ensure that VBC was a good company to invest in,this morning Marvin called Alice and told her to put all of her money into VBC,which Alice did.Later that day VBC declared bankruptcy and Alice lost all of her money.
In these circumstances,Marvin's advice to Alice is
A)an example of undue influence.
B)an innocent misrepresentation.
C)a fraudulent misrepresentation.
D)a mistake.
E)a negligent misrepresentation.

Question

Quizplus · Accepted Answer

Marvin had a duty of care towards Alice as her investment counsellor and he did not properly fulfill that duty by giving advice without even checking whether VBC was a good company to invest in. This could be considered as negligent misrepresentation.

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