Law Chap 7

Law Chap 7 - Law Chap 7 Fraud: This tort also may be called...

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Law – Chap 7 Fraud: This tort also may be called fraud, fraudulent misrepresentation, or deceit. It involves deliberate deception; in business it usually also involves breach of contract. It may be an intentional tort or one based on negligence. This claim is common in breach suits as it may open the door to greater damages, especially punitive damages, than are available under contract law. Intentional Misrepresentation or Fraud—Occurs when the deceit is done knowingly and meets the elements of fraud: material misrepresentation; scienter; intent to induce reliance; justifiable reliance by plaintiff; legal relationship between parties; causation; and damages. Interference with Contractual Relations : An intentional tort that occurs when one knows about a contract between other parties and interferes in that relationship. There must 1) exist a contractual relationship between the injured business and a third party; 2) this must be known to the wrongdoer; and 3) the wrongdoer must intentionally interfere with the relationship. PRODUCTS LIABILITY Consumer Products and Negligence : Negligence by consumer product producers has long been the basis of liability, originating in contract law. Rule of Caveat Emptor—When liability for defective products is rooted in contract law, privity of contract between seller and injured party had to be shown, which was difficult, so buyers had to beware. The rule of liability was negligence, but a contractual relationship had to exist. Selling a product down the chain of distribution could break the relationship between the producer and the consumer. Negligence in Tort—For consumer injuries, privity of contract was eliminated by going to negligence in tort early in the 20th century. Manufacturers held responsible to consumers. Privity requirement eliminated. Strict Liability Under Contract Law : Developed slowly during 20 th century. It developed before strict liability in tort for products. Link was to implied warranty of safety for products for which consumers could not be expected to protect themselves, such as tainted food, drink, or
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Law Chap 7 - Law Chap 7 Fraud: This tort also may be called...

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