Misrepresentation

Question 1

What is misrepresentation?

Answer 1

A false statement of material fact that induces the other party to enter a contract.

Question 2

What are the requirements for misrepresentation?

Answer 2

Made before or at contract (Roscorla v Thomas)

Must be of fact, not opinion or puff

False or misleading

Induces contract

Question 3

Fact vs Opinion

Answer 3

Bisset v Wilkinson (1927) Opinion =/= fact unless expert.
Case: Esso v Mardon (1976) Expert opinion taken as fact.

Principle: Misrep can occur if opinion is made by someone with expertise.

Question 4

Inducement

Answer 4

C must have relied on the statement.

Case: Edgington v Fitzmaurice (1885) – Misstated intention = misrep.

Case: JEB Fasteners v Marks Bloom (1983) – Misrep must materially affect decision.

Principle: Misrep must induce, but not necessarily be sole reason.

Question 5

Silence

Answer 5

Silence ≠ misrep, except:

Half-truths: Dimmock v Hallett

Changed circumstances: With v O’Flanagan

Fiduciary duty cases

Principle: Duty to correct misleading silence in special cases.

Question 6

Types of misrepresentation

Answer 6

fraudulent: D knew it was false or was reckless
Derry v PeekNegligent: D lacked reasonable belief Esso v MardonInnocent: Honest + reasonable belief

Question 7

Remedies

Answer 7

rescission: Cancels contract (all types)
Damages: Available for fraudulent + negligent

Statute: Misrepresentation Act 1967s.2(1): Negligent misrep
D must prove belief was reasonables.2(2): Court may award damages instead of rescission