A vacuum cleaner sales representative approached the Charltons and offered them a deal called the club plan.
Question:
A vacuum cleaner sales representative approached the Charltons and offered them a deal called the “club plan.” Under its terms, the Charltons were to make appointments in their area for sales representatives to demonstrate the cleaners. For each appointment leading to a sale, the Charltons were to receive $25. After some discussion, the couple read and signed the club plan. Then the sales representative mentioned that because they were to be agents for the company, he wanted to leave a vacuum cleaner with them. He then had them sign a “receipt” for the cleaner. Taking his word for the nature of the document (although they could have read the instrument), the Charltons then signed the receipt. Only later, when approached by the Local Finance Company for payment, did the Charltons find out that the receipt was actually a promissory note. Can they successfully defend against payment by claiming fraud in the execution? (Local Finance Co. v. Charlton, 289 S.W.2d 157)
Step by Step Answer: