Misrepresentation essay
Introduction
This question demands for the explanation of one of the most important concepts of
contract law, and that is misrepresentation. This question is basically focused on the
remedies that are available to the parties if misrepresentation has been established. In
this essay we must discuss what is misrepresentation, what are the types and the
remedies available for it. We must also consider the fact that the remedies aren’t only
beneficial to the claimant but also a justification of the law of misrepresentation.
Definition
Before discussing the principles of misrepresentation, first we must know what is a it.
In contract law, misrepresentation is one of the most crucial concepts.
Misrepresentation is described in the Esso Petroleum v Mardon as “A false statement
of fact or law made by one party to another party, which induces the other party to enter
into a contract.” When both parties agree to sign a contract, they are required to tell the
other person the truth and not mislead them in any way. If the misrepresentation is a
contractual term, then it will be considered to be breach of contract and if it is a
representation then the remedies will be accordingly to the Misrepresentation Act 1967.
This can be problematic for both parties and lead to disagreements and court action.
Thus, it is an untrue or misleading statement made by one party that causes another
party to suffer a loss or to enter into a contract under false pretenses.
Actionability
A legally actionable misrepresentation is one that is an imprecise, false statement of
fact that encourages a party to engage into a contract. According to the case Avon
Insurance v Swire Fraser, the element of falsity is, if the defendant stated a half-truth
statement and the claimant relied on the true part of the statement - the statement is
determined to be true. The case (McInerny v Lloyds Bank), informs us that there will
be no misrepresentation if the claimants’ own interpretation is ambiguous.
Misrepresentation can occur in various forms, including through words, conduct
(Curtis v Chemical) (Gordon v Selico), or even silence or omission of material facts.
According to the case of (Bisset v Wilkinson), if the representor makes a statement
solely on his personal opinion this will not be a fact and can’t be constitute as
misrepresentation. But in the case of (Smith v Land), it was established that if the
defendant is in a position to know better than others or has reasonable grounds for the
statement and if he makes a statement then this may constitute as misrepresentation as
the statement will be a fact. Statement of future intent is generally not actionable unless
the defendant does not do accordingly (Edgington v Fitzmaurice). Statements of law
are considered to be misrepresentation (Pankhania v. Hackney), but sometimes it can
be challenging to tell the difference between a statement of law and a statement of fact.
Lastly, the statement should induce the person want to sign the contract. Because of
this, Smith v. Chadwick says that the promise must first be material, which is an
objective condition. Second, the person being represented must know about it (Horsfall
v. Thomas). Lastly, the claim must be taken into account (Peekay Intermark v.
Australia).
