Vitiating Factors: Misrepresentation Flashcards
(42 cards)
What is misrepresentation?
A false statement of material fact made by a party to the contract which induces the other party to enter a contract
When can misrepresentation only occur?
During the formation of a contract
What doesn’t misrepresentation automatically do?
End a contract
But party suffered can take action to end the contract
What does rescission of contract mean?
The parties have returned to their pre-contractual position granted at the courts discretion
What does repudation mean?
End contract immediately
What is a false statement?
Statement must be untrue or inaccurate
Courts determine it on person’s knowledge
How can a false statement be?
Usually written or verbal, but can be through conduct
What happened in Gordan v Selico?
Painting over dry rot before selling property fulfilled elements of misrepresentation
What does there need to be for a false statement?
A statement
Can’t be complete silence
What happened in Fletcher v Krell?
Women never told hirers she was divorced
If they knew she was divorced, they never would have hired her
She had no duty to disclose her marital status
Was not misrepresentation
What happened in With v O’Flanagan?
Doctor accurately stated his profits to induce purchasers to buy practice
He fill ill after made statement, many patients left practice
Failure to disclose any change before acceptance is misrepresentation
What is misrespresentation with half truths?
Silence can be misrepresentation id it is a half-truth
What happened in Dimmock v Hallett?
Seller of land truthfully told purchaser there were tenants on the land
Didn’t mention they were leaving
Part-truth was a misrepresentation
What is the rule on relationships and trust?
When the relationship between parties is based on trust, silence may be misrepresentation
What happened in Tate v Williamson
A financial advisor advised client to sell is land for less then half the value to clear his debt
Advisor bought land and didn’t tell client
Was a breach of trust so was misrepresentation
What is rule around utmost good faith?
Where a contract is made of utmost good faith, all material facts must be disclosed whether they have been asked for or not
Often seen in contracts of insurance
What happened in Lambert v Co-operative Insurance?
D renewed insurance for jewellery but didn’t tell insurance company her husband was convicted for conspiracy to steal
Jewellery was stolen, insurance company refused to pay
Was a misrepresentation so insurance company had right to refuse
What happened in Spice Girls v Aprilla?
Sponsorship between Spice Girls and Aprilla
Didn’t know one of the girls intended on leaving
Promotional material was useless it contained all the girls
Was a misrepresentation was when they all attended, they represented that none of them intended on leaving
What is a material fact?
Would have led a reasonable person to make the contreact and it influenced the C to enter the contract
What must a material fact be?
A fact, not opinion
What happened in Bisset v Wilkinson?
Seller not a sheep farmer, he genuinly believed that farmland could take 2000 sheep
Not a misrepresentation, merely his opinion
What is a statement of future intention?
Not a fact and not a misrepresentation
If no intention to do what was stated, will be misrepresentation
What happened in Edington v Fitzmuarice?
Company stated the shares were to be used to expand company but were actually paying off company debts
Was a statement of future intention but not what he told hte C so was a misrepresentation
What is a party to the contract?
Only party to contract are liable for statements made
