Which of the following defines active concealment?

Prepare for the CA Foundation Business Law Exam with our comprehensive quiz. Utilize flashcards and multiple-choice questions, each complete with hints and explanations. Ace your exam confidently!

Active concealment refers to the intentional act of hiding facts or information that one party knows while failing to disclose that information to another party involved in a transaction. This definition aligns perfectly with the chosen answer, where one party deliberately keeps certain facts from being revealed, thereby influencing the other party's decision-making process without their knowledge.

In a legal context, active concealment is considered a wrongful act because it can lead to fraudulent situations where one party suffers harm due to the lack of transparency. The party that is concealing information might have a significant advantage, which could affect the fairness and equity of the transaction.

Other options, while they may relate to aspects of miscommunication or deception in contracts, do not accurately encapsulate what active concealment specifically entails. For instance, the disclosure of all contract terms is the opposite of concealment, and providing misleading information can be a separate act of misrepresentation rather than the specific act of concealing known facts. Refusal to sign a contract does not involve any act of concealment; rather, it is a choice not to engage further in the transaction.

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