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Flashcards in Revision Book Deck (31)
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1
Q

What statements might not be seen as a statement of material fact?

A

Opinion
Sales talk
Statements of future intention or conduct
Statements of law

2
Q

Is a false statement of opinion a misrepresentation as to fact?

A

No (Bissett v Wilkinson - sheep, farmer had no experience of sheep which other party knew).

3
Q

What if someone gives their opinion when they have specialist knowledge or skill?

A

It may be considered as being an implied representation of fact, therefore being capable of a misrepresentation (Smith).

4
Q

Can sales talk amount to a misrepresentation?

A

No they are idle boasts (Dimmock - fertile land).

5
Q

Can statements of future intent be a misrepresentation of fact?

A

No, future intention is mere speculation unless it falsely represents the actual intention (it is a wilful lie)(Eddington - shares for paying off business not future growth).

6
Q

Can a statement of law be a misrepresentation as to fact?

A

Normally no as everyone knows the law but sometimes fact and law are not clear cut (Solle - converted flats). However in Pankhania there was a misrepresentation of law when they described a property for sale subject to licence when it was in fact a lease.

7
Q

Can non disclosure of information and silence amount to a misrepresentation of fact?

A

There is no duty to disclose material facts to the other party (Keates - house in disrepair) unless it is a contract of utmost good faith, change in circumstances, half truths and where there is a fiduciary relationship.

8
Q

What is a contract of good faith?

A

In these types of contracts there is a duty to disclose all material facts where one party is in a stronger position of knowing the truth than the other, for example contracts of insurance.

9
Q

What is a change in circumstances with regards to the exception to the general rule of silence not amounting to a misrepresentation?

A

This is where a statement was true when it was made but became false by the time the contract was made (With v O’Flanagan).

10
Q

What is a half truth in misrepresentation?

A

Where a statement does not represent the whole truth, then it is a misrepresentation (Notts Patent Brick & Tile Co - solicitor said no restrictive covenants but he had failed to check).

11
Q

Why can a fiduciary relationship be a cause for misrepresentation?

A

The fiduciary relationship imposes a duty of disclosure. Example, doctor patient, solicitor client.

12
Q

How can you have a misrepresentation by conduct?

A

By your actions rather than orally or written. Spice Girls - all 5 members took part in the commercial suggesting they would continue working together.

13
Q

In a problem question, what do you think would happen if the impression given is false when looking at the facts in the question (Spice Girls for example)?

A

It may amount to a misrepresentation by conduct.

14
Q

Can a misrepresentation be made after the contract is formed?

A

No, it must be made before (Roscorla).

15
Q

What is inducement into the contract?

A

The claimant must have relied on or been induced to enter the contract by the false statement of fact. They must have:
Known of the statement (Horsefall - unaware of defect in gun when purchased)
Relied on the statement which induced him to enter the contract (Attwood - told incorrect facts of mine but had independent people check therefore they did not rely on defendant)

16
Q

What are the types of misrepresentation?

A

Innocent (s2(1) of misrepresentation act)
Negligent (Hedley Byrne)
Fraudulent (Derry v Peek)

17
Q

What do we look at when considering fraudulent misrepresentation?

A

If it is an honest belief or not, motive is irrelevant (Akerhielm).

18
Q

What actions are available for negligent misrepresentation?

A

Available at common law and statute.

19
Q

What is the remedy for negligent misrepresentation at common law?

A

Rescission and/or damages may be recoverable for financial loss (Hedley Byrne) if the D carelessly made a false statement and it is reasonable to assume that statement will be relied upon and there is a special relationship between the parties (Esso v Marden).

20
Q

In an exam question if it mentions a special skill someone has, example accountant, or they are acting in a way that they give the impression they have a specialist skill what should you consider?

A

Negligent misrepresentation.

21
Q

When should you consider negligent misrepresentation under statute?

A

Where there is a contract and an action under the Hedley Byrne principle might not be straight forward as it is the D who has to prove he had a continuing honest belief in his statement.

22
Q

What are the key differences between common law and statute for negligent misrepresentation?

A

Common law: Statute:
Burden of proof on C Burden of proof on D
No contract required Contract required
Special relationship required No special relationship required

23
Q

What is innocent misrepresentation?

A

A statement which is made in the belief that it is true and there are reasonable grounds for that belief.

24
Q

What is the remedy for innocent misrepresentation?

A

Rescission or damages.

25
Q

What is the remedy for fraudulent misrepresentation?

A

Rescission and/or damages.

26
Q

What does rescission of the contract do?

A

It puts the parties in the position they would have been had the contract not existed but there are limitations to this.

27
Q

What are the limitations on the availability of rescission of a contract?

A

Affirmation (if C expresses they intend to continue omits implied from their conduct (Long v Lloyd))
Lapse of time (where there has been too long a lapse of time before rescission is sought)
Rights of third parties (if goods are obtained by misrepresentation and sold in good faith to a third party (White))
Impossible to restore parties to original positions (precise restoration is not required as long as substantial restoration is possible (Head))
Damages in lieu of rescission is a better remedy (s2(2) misrepresentation act 1967)

28
Q

What damages can you claim for fraudulent misrepresentation?

A

It is the out of pocket financial loss (McConnel) as well as loss of profits that resulted from the reliance on the misrepresentation (East).

29
Q

What damages can you claim for negligent misrepresentation?

A

You can claim under the Hedley Byrne principle for reasonably foreseeable losses or under s2(1) misrepresentation act 196 if there is a contract (these are the same as fraudulent misrepresentation damages - Royscot Trust).

30
Q

What is specific performance?

A

Where the court orders parties to continue with the contract as it is set out even it would save the mistaken party from a bad bargain (Tamplin - purchase of a lot thought to include gardens, plans were available to view at the time of purchase, ordered to proceed with sale).

31
Q

What is the definition of an actionable misrepresentation?

A

A statement of material fact made prior to the contract by one party to the other which is false or misleading and induced the other party to enter the contract.