Misrepresentation Flashcards
What is misrepresentation ?
Misrepresentation is a vitiating factor that makes a contact voidable. The victims can rescind the contract.
Under common law, how does misrepresentation occur ?
Under common law, it occurs during the formation of a contract and involves a false statement of material fact , made by a party to the contract that induces the other party to enter the contract.
IF RELEVANT: Can silence be a false statement and what is the exception + cases ?
Silence cannot be a false statement ( FLETCHER v KRELL ), unless the representor remains silent when a statement was initially true the becomes untrue ( WITH v O’FLANAGAN ).
IF RELEVANT: What can also be a misrepresentation + case ?
A half truth can be a misrepresentation (DIMMOCK v HALLETT ).
IF RELEVANT: What cannot be misrepresentation + case ?
It cannot be an opinion (BISSET v WILKINSON ).
IF RELEVANT: How else can misrepresentation be made by + case ?
It can be made by conduct/circumstances as well as words (SPICE GIRLS v APRILLIA ).
(IF THERE HAS BEEN A FALSE STATEMENT): What must the false statement do to the other party + cases ?
The false statement must induce the other party to enter the contract, which means its must be relied on by the claimant (ATTWOOD v SMALL, REDGRAVE v HURD, but doesn’t have to be the only reason for entering the contract ( EDGINGTON v FITZMAURICE ).
IF RELEVANT: What must happen if there is a consumer insurance contract + act + case ?
If there is a consumer insurance intractable, the answers to questions must be answered honestly ( THE CONSUMER INSURANCE (DISCLOSE AND REPRESENTATIONS) ACT 2012 ), modifying the decision in LAMBERT v CO-OP.
IF RELEVANT: What happens if the consumer has deliberately lied ?
The insurance company can avoid the contract and keep any instalments paid.
IF RELEVANT: What happens if the consumer didn’t realise they should have disclosed the info ?
The insurance is still valid but any pay-out is reduced by the amount the company undercharged.
IF RELEVANT: What is a false statement of future intention + case ?
Generally a false statement of future intention is not a false statement of fact. However, a false statement of future intention will be a false statement of fact if the maker of the statement has no intention of carrying it out ( EDGINGTON v FITZMAURICE ).
What is fraudulent misrepresentation + cases ?
Fraudulent ( knowingly or recklessly wrong - DERRY v PEEK ), where the remedy is rescission and damages in the tort of deceit, (EAST v MAURER ).
What is negligent misrepresentation + cases + act ?
Negligent ( carelessly wrong, as defined in HEDLEY BRYNE v HELLER ). The remedy is rescission ( THE WAGON MOUND ) and/or damages (S(2(2) of The Misrepresentation Act ).
What is innocent misrepresentation + act + case ?
Innocent ( honestly wrong ) (S2(1) Misrepresentation Act 1967 ) where the remedy is rescission ( LONG v LLOYD ) or damages (S2(2) Misrepresentation Act 1967 ).
Under S2(1) of The Misrepresentation Act 1967, who has the burden of proof, once C has proven there’s been a misrepresentation ?
Once C has proven there has been a misrepresentation, the burden of proof is on the person making the statement that there were reasonable grounds to believe the statement was true. If reasonable grounds can’t be shown, the the statement will negligent.
IF RELEVANT: What will not be awarded if it is impossible ?
Rescission won’t be awarded if it’s impossible.
IF RELEVANT: What happens if the innocent party decides to continue with contract despite being aware of the misrepresentation + case ?
The right to rescind is lost ( LONG v LLOYD ).
IF RELEVANT: What happens if the innocent party delays bringing a claim + case ?
The right to rescind is lost ( LESF v INTERNATIONAL GALLERIES ).
IF RELEVANT : What happens if a third party has gained rights over property + case ?
The right to rescind is lots ( LEWIS v AVERAY ).
IF RELEVANT - for an OMISSION in a consumer contract: What happens if information is deliberately left out or presented in an unclear way + act ?
The Consumer Protection Regulations 2008 and 2014 set out the right to “unwind” the contract, which is the statutory equivalent to rescission.
