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Five Fact Friday: Misrepresentation

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Five Fact Friday: Misrepresentation

This week it was revealed, following an investigation, that only 1% of the bulbs sold at Amsterdam’s famous floating flower market, ever blossom.  That spells trouble for those sellers touting their tulips to tourists but it’s also an opportunity to present five fascinating facts about the thorny area of misrepresentation.

1. A reasonable be-leaf?

A misrepresentation is a statement of fact that is (or turns out to be) untrue and which induced a party into a contract. A statement of fact is also not the same as an opinion.

Broadly speaking, there are three different types of misrepresentation:

  • Fraudulent: the person making the untrue statement either knows that it is untrue, does not themselves believe their statement to be true or is reckless as to the truth of the statement. 
  • Negligent: the person making the untrue statement did not take reasonable care to check its accuracy.
  • Innocent: the person making the untrue statement had reasonable grounds for believing that it was true at the time they made it.
2. Thistle cheer you up!

If you have been the victim of any of the types of misrepresentation mentioned above, it is possible to claim damages (i.e. compensation for your loss) if you can prove that you have suffered a loss as a result of that misrepresentation.  In addition, if the misrepresentation was fraudulent or negligent, you may also be able to set the contract aside (this is called ‘rescission’).

3. Like pollen teeth!

Misrepresentation is notoriously difficult to prove.  The three hurdles to clear are:

  1. There must have been a statement of fact - not a statement of intention or an opinion or a promise (context is key);
  2. The statement must have induced the claiming party to enter into the contract - ‘but for’ the misrepresentation, would the contract have gone ahead?  Not only must the statement have played a real and substantial part in the party entering the contract but the person making the statement must also have intended this to be the case; and
  3. The representation must have been false – although this will sometimes be obvious, it will not always be so.  The burden is on the claiming party to prove that the statement was false.
4. Tu-Lips are sealed

Silence in itself cannot give rise to a misrepresentation, but it is possible that a statement will become misleading because something has not been said.  For example, if a statement implies that it has covered all the material facts, something that has not been referred to in that statement can be assumed not to exist. 

Silence might also be a misrepresentation if a previous statement, which was true at the time, has since become untrue.  Indeed, the Spice Girls were the subject of a misrepresentation claim when they agreed to endorse a range of Italian scooters but failed to inform the manufacturers that Geri Halliwell, as she then was, had decided to leave the band between the negotiation and the signing of the contract.

5. Last bud not least

With Halloween approaching, it is worth mentioning that misrepresentation has been used both in England and in other parts of the world to claim against sellers of properties that have failed to disclose its grizzly or occasionally spooky history.

In 2004, the Court of Appeal ruled that the seller of a property was not liable in misrepresentation when they failed to inform the buyers that a particularly gruesome murder had taken place in the building (before the seller had moved in) and that body parts had been distributed across the house.  The claim rested on whether the seller had misrepresented the property when they answered “no” to the question “Is there any other information which you think the buyer may have a right to know?” 

Whether you have been on the wrong end of a misrepresentation by somebody pedalling their wares or whether you are looking for the answer to any of your legal problems once and floral, Dutton Gregory will root for you.

With five offices across Hampshire and Dorset, we provide legal expertise and dedicated client service. We work closely alongside both individual and corporate clients to achieve successful outcomes.

If you wish to speak to a member of our team, email them today at contact@duttongregory.co.uk or call your nearest office.