Reference no: EM133410887

Question

Paul was trying to sell his accounting practice together with the office building from which it operated. Janine was interested in purchasing as she wanted to work closer to home and she liked the idea of the challenge and independence that running her own practice would bring. In August, Janine asked to inspect the accounts as of 30 June and Paul produced the accounts. All appeared to be in order and the business was quite profitable. In October, she made an offer to purchase which was accepted by Paul and the transaction was completed soon after. A few months after the purchase, Janine heard that, in September, Paul had discovered that one of his employees had been defrauding the business. Upon being discovered, the employee had shot himself while in the firm's waiting room. The business has not been as profitable as Janine expected and she believes that both of these events might have contributed to that result. Janine did ask Paul how the business has been going since June. Paul said everything was fine without making any reference to the incident in the firm's waiting room in September. Is there any action which Janine can take against Paul?