misrepresentation

Definition of misrepresentation

Etymology

misrepresent +‎ -ation

Pronunciation

• IPA: /mɪsˌɹɛpɹɨzɛnˈteɪʃən/
• Audio (US) ^[?]
• Rhymes: -eɪʃən

Noun

misrepresentation (plural misrepresentations)

1. Erroneous or false representation; an unfair or dishonest account or exposition; a false statement: as, to injure one's character by misrepresentations.
2. Incorrect or unfaithful representation in the capacity of agent or official representative, as of a principal in a matter of business, or of constituents in legislation.

Further reading

Misrepresentation is a contract law concept. It means a false statement of fact made by one party to another party, which has the effect of inducing that party into the contract. For example, under certain circumstances, false statements or promises made by a seller of goods regarding the quality or nature of the product that the seller has may constitute misrepresentation. A finding of misrepresentation allows for a remedy of rescission and sometimes damages depending on the type of misrepresentation.

According to Gordon v Selico (1986) 18 HLR 219 it is possible to make a misrepresentation either by words or by conduct, although not everything said or done is capable of constituting a misrepresentation. Generally, statements of opinion or intention are not statements of fact in the context of misrepresentation. If one party claims specialist knowledge on the topic discussed, then it is more likely for the courts to hold a statement of opinion by that party as a statement of fact.

Representation is not a term

As enacted by the Misrepresentation Act, the statement in question may constitute a representation even if later incorporated into the contract as a term (i.e. a warranty, condition or innominate term).

An alternative approach, applied in parallel but in exclusivity to, is to find a collateral contract by interpreting the representation as a promise accompanied by some sort of consideration (see Heilbut, Symons & Co. v Buckleton [1913] A.C. 30 (H.L.)). The collateral contract will have the effect of adding the representation as a term to the contract.

If the representation is found to be a term then the normal remedies for breach of contract apply.

Criteria for Misrepresentation

Misrepresentation is one of several vitiating factors which can affect the validity of a contract. A misrepresentation occurs when one party makes a false statement with the intention of inducing another party to contract. For an action to be successful, some criteria must be met in order to prove a misrepresentation. These include:

• A false statement of fact has been made,
• The statement was directed at the suing party and
• The statement had acted to induce the suing party to contract.