WJEC/Eduqas Law for A level Book 2 Revision Guide

Chapter 1 The law of contract Activity 1.6 What is misrepresentation? Select the cases from the list to show which ones influence which part of the definition of misrepresentation. Some parts of the definition have more than one case relating to them. Misrepresentation is … Case examples … a statement of material fact … … made by one party to a contract to the other party … … during the negotiations leading up to the formation of the contract … … which was intended to operate and did operate as an inducement … … under the contract, and which was untrue or incorrectly stated. Fraudulent misrepresentation Where fraudulent misrepresentation is alleged, fraud must also be proved. Derry v Peak (1889) showed that, if a person makes a false statement that they do not believe to be true at the time, this is a fraudulent misrepresentation. The claimant will then sue for damages, which will be awarded according to the tort of deceit and are also available under s2(1) Misrepresentation Act 1967 . The equitable remedy of rescission is also available. The defendant is responsible for all losses, including any consequential loss that has a causal link between the fraudulent misrepresentation and the claimant’s loss. Negligent misrepresentation According to Hedley Byrne v Heller & Partners (1964) , damages may be recovered for a negligent misrepresentation where a financial loss has been incurred and where there is a special relationship between the parties. There are three requirements: 1. The party making the statement must possess the particular type of knowledge for which the advice is required. Cases to use Attwood v Small (1838) Bisset v Wilkinson (1927) Couchman v Hill (1947) Edgington v Fitzmaurice (1885) JEB Fasteners Ltd v Marks Bloom & Co Ltd (1983) Peyman v Lanjani (1985) Roscorla v Thomas (1842) 20