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To cancel a contract because of misrepresentation, fraud, or illegal procedure.
Copyright © 2012, Campbell R. Harvey. All Rights Reserved.


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 When a contract is rescinded, both parties are restored to the status quo before the contract was entered (as much as possible).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.
Farlex Financial Dictionary. © 2012 Farlex, Inc. All Rights Reserved


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• Acontract may be rescinded if there was fraud in the inducement, meaning a fraud with the underlying transaction and not with the nature of the contract or document signed.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

The Complete Real Estate Encyclopedia by Denise L. Evans, JD & O. William Evans, JD. Copyright © 2007 by The McGraw-Hill Companies, Inc.
References in periodicals archive ?
As per the Washington Post report, the US President talked with his advisers about rescinding the nomination, after Gorsuch was critical of the President's escalating attacks on the federal judiciary in private meetings with legislators.
On Tuesday evening, members of the controlling Labour group apologised for the way the matter had been handled and said they would investigate the possibility of rescinding the pay rises.
Concerns may also have arisen because the rescinding transactions did not completely unwind all steps of the original transaction, and the parties consequently did not return to the same position in all respects as if the transaction had never occurred.
The ultimate outcome of the no-match rule is not clear, however, after a July 9 vote in the Senate to effectively block the DHS from rescinding the rule.
But after the suppression of the post-election protests in Iran, the State Department announced it was rescinding that offer.
On March 31, 2009, the Illinois Appellate Court, First District, reversed and remanded the judgment of the Circuit Court of Cook County rescinding the statutory summary suspension of the defendant's driver's license.
The Centers for Medicare and Medicaid Services has proposed rescinding three Medicaid rules that were finalized in the last days of the Bush administration.
"Rescinding the law would pose no threat to the rights of health-care workers, and instead would serve to ensure that more individuals have access to health care," wrote Margaret E Garrett, AU assistant legislative director.
The USCCB'S press releases, editorials and YouTube videos suggest that in rescinding the refusal clause regulation, Catholic health-care workers would be forced to perform procedures which contradict their conscience.
Omissions or misstatements by agents of the insurance company are not chargeable to the insured and the insurer will be stopped from rescinding the policy.
Bates a letter telling her it was rescinding her health insurance policy.
The government indicated lack of fulfilment of contractual obligations as the reason for the rescinding of the contract.