Misrepresentation In Court Essay

2485 words - 10 pages

Misrepresentation in Court A misrepresentation may be defined as an unambiguous, false statement
of fact (or possibly of law) which is addressed to the party misled,
which is material and induces the contract. A misrepresentation
renders the contract voidable and it may give rise to a right to
damages depending on the type of misrepresentation.

If the misrepresentation would have induced a reasonable man into the
contract the court will presume that it did induce the representee to
enter the contract and the onus of proof is placed on the representor
to show that the representee did not rely on the representation. This
was shown in Museprime Properties Ltd[1], where the judge referred,
with approval, to the view of Goff and Jones: Law of Restitution that,
any misrepresentation which induces a person to enter into a contract
should be a ground for rescission of that contract. This is known as
the objective test.

A false statement of opinion is not a misrepresentation of fact,
Bisset v Wilkinson[2]. However, where the person giving the statement
was in a position to know the true facts and it can be proved that he
could not reasonably have held such a view as a result, then his
opinion will be treated as a statement of fact, as in Smith v Land &
House Property Corp[3]. This rule does not apply where the
misrepresentation was fraudulent and the representee was asked to
check the accuracy of the statement: Pearson v Dublin Corp. There will
be reliance even if the misrepresentee is given an opportunity to
discover the truth but does not take the offer up. The
misrepresentation will still be considered as an inducement, Redgrave
v Hurd. There will be reliance even if the misrepresentation was not
the only inducement for the representee to enter into the contract, as
in, Edgington v Fitzmaurice. When Flash said that Harry would be
successful with such a car, this is merely sales talk, or a ‘mere
puff’, and does not amount to misrepresentation.

Fraudulent misrepresentation was defined by Lord Herschell in Derry v
Peek[4] as a false statement that is "made (i) knowingly, or (ii)
without belief in its truth, or (iii) recklessly, careless as to
whether it be true or false." Therefore, if someone makes a statement
which they honestly believe is true, then it cannot be fraudulent. The
burden of proof is on the plaintiff - he who asserts fraud must prove
it. Tactically, it may be difficult to prove fraud, in the light of
Lord Herschell's requirements. The remedy is rescission and damages in
the tort of deceit. Negligent misrepresentation is a false statement
made by a person who had no...

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