Question
Aman owns a bike shop in Nopromise Road and advertises the business for sale. He is approached by Sahaj, who is interested in buying the
Aman owns a bike shop in Nopromise Road and advertises the business for sale. He is approached by Sahaj, who is interested in buying the business. During initial negotiations in January 2020, Aman tells Sahaj that "The local council has decided to turn Nopromise Road into a shopping mall in time for Easter" (Aman had been mistakenly told this by a council employee) and "Selling bicycles is a wonderful business to be in". During further negotiations in March 2020, Aman tells Sahaj that "People will always need bikes, so the future of the business is recession proof" and "The average monthly turnover for the last six months of 2019 was $50,000". Sahaj enters into a written contract to buy the business and takes over in early June, 2020. Amongst other things, the contract provides that (i) the lease of the shop premises is to be transferred to Sahaj and (ii) has three years still to run, with an option to renew for a further term of three years. The written contract makes no reference to any of the matters in the above conversations, in January and March 2020, between Aman and Sahaj. Later, Sahaj discovers that the monthly turnover for the last six months of 2020, in fact, averaged only $30,000. In addition, demand for bikes had dropped dramatically, due to the local economy being in recession. Sahaj also learned that the local council had never decided to turn Nopromise Road into a shopping mall and that the lease of the shop, which was transferred to him, had only eight months to run, with no option of renewal. Under the common law of contract, what are Sahaj's legal rights against Aman? Fully justify your answer, citing case authority.
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