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To cancel a contract because of misrepresentation, fraud, or illegal procedure.


To cancel a contract and declare it invalid from its beginning. When a contract is rescinded, both parties are restored to the status quo before the contract was entered (as much as possible). Rescission may occur by mutual agreement, or when one of the parties misrepresented himself/herself before the contract was signed.


To withdraw or undo.The act itself is called rescission. If a party has a right of rescission, the party may rescind a transaction.Important rescission rights include the following:

• Under the Truth-in-Lending Act, consumers may rescind a loan transaction if the lender failed to provide all required disclosures.

• Certain state laws give homeowners the right to rescind sales contracts for properties in danger of foreclosure.

• Most states still allow insurance companies to rescind policies if there was a fraud in the representations made to secure the policy.

• Acontract may be rescinded if there was fraud in the inducement, meaning a fraud with the underlying transaction and not with the nature of the contract or document signed.

• Under the Truth-in-Lending Act, consumers refinancing their principal residence or taking out a home equity line of credit may, with certain exceptions, rescind the loan within 3 business days and not owe any interest or fees.

References in periodicals archive ?
70) As to reportable transactions, the penalty can be rescinded by the FTB Chief Counsel, but only if (1) the taxpayer on whom the penalty is imposed has a history of complying with the California income and franchise tax laws; (2) it is shown that the violation is due to an unintentional mistake of fact; (3) imposing the penalty would be against equity and good conscience; and (4) rescinding the penalty would promote compliance with the tax laws and effective tax administration.
Using a sample of 39 companies that rescinded their stock repurchase plans between November 1995 and June 1998 to preserve pooling treatment, we compared the costs and benefits of pooling vs.
At the same time, ACA's legislative council, Dave Gray, contacted camps in Vermont to build support for having Vermont Senators Leahy and Jeffords intercede on camps' behalf to have the regulation rescinded.
Sources at both Novacor and BASF confirm they have rescinded their increase announcement.
But he said previously that if the ordinance is found to be unconstitutional, it should be rescinded.
The penalty can be rescinded or abated for reportable transactions in exceptional circumstances.
The Army G-4 Publication Enrollment Notification System (PENS) is a web-based system that allows logisticians to request real time automatic notification when specific G-4 regulations or pamphlets have been changed or rescinded.
In the TAM, the IRS required capitalization of the costs solely because for three years the land rested with the county as a consequence of the ultimately rescinded gift.
12 /PRNewswire/ -- Innovative Gaming Corporation of America (Nasdaq: IGCA) today announced that it has received notification from the Wisconsin Gaming Commission that the commission has rescinded its previous written acknowledgment of the approval of IGCA's Live Video Blackjack game.
Then, by mid-February, some PP producers rescinded that increase, and prices fell back to December levels.
The Appellate Division, by a three to two decision, agreed with the purchaser and ordered the contract rescinded and the down payment returned to him.
The lawsuit, filed in October, 2006, alleges that Blue Cross illegally rescinded patients' health care insurance policies after the patients received services at California hospitals.