Misrepresent Mugger Notes

Misrepresent Mugger Notes - Misrepresentation (Mugger...

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Misrepresentation (Mugger Notes) 1. Introduction The question of whether the statement made prior to the formation of the contract is a Representation or a Term determines the remedies. Breach of a Term involves the Remedies of Breach , while Breach of a Representation involves the Remedies of Misrepresentation . Rescinding a contract for Breach may be different from rescinding a contract for Misrepresentation . This distinction may be less important in light of the Misrepresentation Act 1967 : Section 1(a) states that even where a non-fraudulent misrepresentation has become a term of the contract, the innocent party can still sue for misrepresentation. Previously, this was not possible as it was held that the “representation becomes merged in the higher contractual right”. Section 2(1) allows for Damages to be awarded for Negligent Misrepresentation (and possibly for limited scope of Innocent Misrepresentation). Previously, Non-Fraudulent Misrepresentations did not carry a right to damages. It is quite common for Breach of Contract and Misrepresentation to be pleaded in the alternative as this increases the innocent party’s chances of success. However, this distinction may still be important in the following areas : When the contractual term is a Warranty , breach of a contract does not allow for rescission but misrepresentation may. The Quantum of Damages may differ between the 2. Breach tends to put the innocent party in the position where the contract has been fully performed (expectation loss) . Misrepresentation tends to put the innocent party in the position where the contract has not been made . 2. Operative Misrepresentation The 4 elements of an Operative Misrepresentation are : (Important!!!) There must be a false statement . The statement must be of past or existing fact . It must have been addressed to the party misled . It must have induced the contract. A. False Statement i) Silence Mere Silence does not constitute misrepresentation, except in situations of good faith (eg. Insurance policies) where the parties are in a fiduciary relationship . There must be some positive conduct to actively mislead the other party. A nod, a wink, or a nudge may suffice as active conduct. Lord Campbell stated (at 723-724) that : Simple reticence does not amount to legal fraud, however it may be viewed by moralists. But a single word, or (I may add) a nod, wink, or a shake of the head, or a smile from the purchaser intended to induce the vendor to believe the existence of a non-existent fact …” ii) Half-Truths False Statement if it distorts the overall picture given to the innocent party. Dimmock v Hallett (1866) 2 Ch App 21
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This note was uploaded on 02/07/2012 for the course LGST 101 taught by Professor Hsu during the Spring '11 term at Singapore Management.

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Misrepresent Mugger Notes - Misrepresentation (Mugger...

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