Question
Jacob and Nathan were the only shareholders in Goodenough Pty Ltd and they have known each other for a long time. Jacob represented to Nathan
Jacob and Nathan were the only shareholders in Goodenough Pty Ltd and they have known each other for a long time. Jacob represented to Nathan in July that he desired to purchase Nathan shares, as he was aware that Nathan would like to retire and travel the world. Jacob indicated that he did not intend to resell Nathan's shares, as he proposed to conduct the company's business for the benefit of his family. Nathan, who much preferred the business to be owned by Jacob rather than an outsider, sold his shares to Jacob at an undervalue. Completion of the transaction was scheduled to take place in October. In September, Jacob changed his mind about keeping the shares in the family and decided that he would resell the shares at a profit in October. He concealed his intention from Nathan and the shares were subsequently sold to an outsider. When Nathan found out what had occurred, he took Jacob to court to recover the loss he suffered in entering into the contract with Jacob. Will Nathan succeed in recovering damages for Jacob's misrepresentation under common law? Why/Why not? Use case law to support your answer
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