misrepresentation

Question 1

dimmock v hallet

Answer 1

Facts: Seller falsely claimed farms were “fully let”; buyer later found tenants were leaving.

Held: Misrepresentation about tenancies allowed rescission; “fertile and improvable” was mere puff.

Impact: Early case distinguishing puffery from misrepresentation in contract law.

Question 2

spice girls

Answer 2

silence caveat emptor and conduct defying the reality could amount to misrep

Question 3

with o flanagan

Answer 3

With v O’Flanagan (1936): A change in circumstances after a truthful statement may require disclosure. change of circumstances

Question 4

esso petroleum

Answer 4

expert opinion will constitute as a fact

Question 5

edgington v fitzmaurice

Answer 5

Facts: Directors lied about loan purpose; lender relied partly on this and partly on his own error.

Held: Fraudulent misrepresentation—false statement of intent + material reliance.

Rule: Partial reliance suffices; statements of present intention can be misrepresentations.

Question 6

redgrave v hurd

Answer 6

Facts: Solicitor exaggerated earnings; partner sued after discovering the truth.

Held: Misrepresentation proven despite access to true accounts.

Rule: Reliance is not negated by the claimant’s failure to investigate.

Question 7

horsfall v thomas

Answer 7

Facts: Buyer sued over a defective gun he didn’t inspect.

Held: No fraud—seller didn’t actively hide the defect, and buyer’s lack of inspection broke reliance.

Rule: Fraud requires active deception; mere silence ≠ misrepresentation without a duty to disclose.

Question 8

dadourian group

Answer 8

Facts: Investors claimed they were misled into a contract.

Held: If the claimant would have signed the same deal anyway (e.g., due to other compelling terms), the misrepresentation might not justify rescission or damages.

Rationale: The false statement must be a decisive factor—not incidental.

Question 9

univ finance v caldwell

Answer 9

notifying relevant third parties

Question 10

lanjani and lloyed

Answer 10

dual knowledge and affirmation

Question 11

clarke v dickinson

Answer 11

Facts: Investor misled into joining a failing mining venture; sought rescission after losses.

Held: No rescission—restitution impossible due to work performed and profits taken.

Rule: Rescission requires parties to be restored to their pre-contract position.

Question 12

salt v stratsone

Answer 12

Facts: Buyer told car was “new” (5 miles), but it was used (500 miles).

Held: Negligent misrepresentation → damages (s.2(1)), but no rescission (restitution impossible).

Rule: Partial reliance suffices; Royscott damages apply to negligent misrep.

Question 13

derry v peek

Answer 13

Facts: Directors honestly believed steam trams would be approved; investor lost money when permission was refused.

Held: No fraud because no dishonesty—fraud requires knowledge of falsity or recklessness.

Impact: Strict fraud rule; later reforms introduced liability for negligent misstatements in company prospectuses.

Question 14

hedley byrne

Answer 14

Facts: Bank gave negligent reference with disclaimer; ad agency relied and suffered loss.

Held: Negligent misstatements can create liability if there’s a special relationship and reliance, but disclaimer excluded duty here.

Impact: Foundation for negligent misrepresentation claims in tort.

Question 15

royscott v rogerson

Answer 15

Principle: Negligent misrepresentation damages = fraud damages (all direct losses).

Basis: Misrepresentation Act 1967 s.2(1) creates a “fiction of fraud.”

Criticism: Overcompensates claimants, punishes negligence like fraud.