Chapter 4 PT 2

Question 1

The following will not amount to misrepresentation if they prove to be unfulfilled or noncorrect?

Answer 1

1) Expressions of opinion
2) Forecasts
3) Statements of intention

Question 2

The following will not amount to misrepresentation if they prove to be unfulfilled or noncorrect

Answer 2

1) Expressions of opinion
2) Forecasts
3) Statements of intention

Question 3

What does it mean when it’s said that the state of a person’s mind is considered a fact and how can they be held liable?

Answer 3

1) If a person expresses a belief or
opinion that they do not actually hold or lacks the will to act on a stated intention,
they are misrepresenting their state of mind and can be held liable.
2)

Question 4

Can a person misrepresent their state of mind in a non-fraudulent way? If so,
how?

Answer 4

1) It’s hard to imagine a person misrepresenting their state of mind in a nonfraudulent way.
2) However, in England, the Court of Appeal has ruled that under exceptional circumstances, a sincere expression of opinion may imply a representation that the speaker has reasonable grounds for holding that opinion

Question 5

What happens if a party induces another to enter into a contract by representing that they interpret a clause in the document in a certain way, even if it is not legally correct?

Answer 5

If a party induces another to enter into a contract by representing that they interpret a clause in the document in a certain way, they will be bound by that interpretation,
even if it is not legally correct

Question 6

Does puffery amounts to misrepresentation?

Answer 6

1) Puffery does not amount to
misrepresentation.

Question 7

What is the expectation of the other party when one party is praising their goods or services?

Answer 7

1) The party is merely praising their goods or services, a common practice in
sales, and the other party is generally expected to be aware of this

Question 8

In the cases where a statement goes beyond general praise and specific
details it may then entail liability, what must be considered to determine whether it constitutes a misrepresentation or puffery?

Answer 8

1) If a statement goes beyond general praise and includes specific details, it
may entail liability.
2) In such cases, the entire statement must be considered to determine whether it constitutes misrepresentation or puffery

Question 9

simplex commendatio non obligat’ is puffery

Answer 9

In particular puffery by a contracting party does not amount to misrepresentation if it is nonspecific and does not condescend to particulars.

Question 10

Puffing entails making statements about a product you are promoting for
example advertising how good your shoe cleaner cleans shoes

Answer 10

1) It can be difficult to distinguish between misrepresentation and puffery, and
this is a factual question to be determined objectively by the court based on
the specifics of each case.

2) Puffs are a type of opinion, and it has been suggested that the reason there
is no liability for puffs, opinions, and statements of intention is that reliance
on such statements is not considered reasonable

Question 11

What is the definition of dictum et promissum in the context of Roman and
Roman-Dutch law?

Answer 11

It’s defined as a material statement made by the seller to the buyer during
negotiations, which goes beyond mere praise and comments on the quality
of the item for sale (res vendita)

Question 12

What are the aedilitian remedies available to a buyer if a dictum et promissum
turns out to be unfounded?

Answer 12

1) Cancel contract (action redhibitoria)
2) Sue for reduction of purchase price (action quanti minoris)

Question 13

What is the difference between actio redhibitoria and actio quanti minoris?

Answer 13

1) The concept of a dictum et promissum is not confined to any specific categories and clearly excludes puffing.
2) It’s limited to the contract of sale
and within this context, it’s a form of representation

Question 14

In what circumstances does a dictum et promissum become a warranty?

Answer 14

1) If the representation is guaranteed, it becomes a warranty

Question 15

What are the usual remedies for breach of contract in the context of a dictum et
promissum?

Answer 15

1) Breach of this warranty will give rise to the usual remedies for breach of contract

Question 16

Can a buyer still claim aedilitian relief if a dictum et promissum is guaranteed
and becomes a warranty? Why or why not?

Answer 16

1) The buyer retains the right to claim aedilitian relief instead if they prefer

Question 17

Misrepresentation by:

Answer 17

1) Material
2) Other party and 3rd party.
3) Intention to induce a contract.
4) Induced contract

Question 18

Non - Disclosure is subject to several exceptions.
By proving the following then omission is then actionable:

Answer 18

1) If the parties conduct is wholly or partly responsible for another’s ignorance.

2) If the contract requires parties to work together in a relationship of trust and confidence

3) If the party is involuntarily dependent on him for frank disclosure due to his particular knowledge

Question 19

Describe the definition of Fair dealing and list the case in which the meaning was concretized.

Answer 19

1) Party is involuntarily dependent on him for frank disclosure due to his particular knowledge
2) Fair dealing → the right to have such info communicated to him would be naturally
recognized by ‘honest man in the circumstances.
3) Pretotius v Nata South Sea
Investment Trust Ltd

Question 20

Material misrepresentation.
Test

Answer 20

1) Would the statement made have induced a reasonable person to enter into the contract?

Question 21

Test in the case of a nondisclosure

Answer 21

1) Would a reasonable person have been persuaded against entering into a contract if the disclosure had
been made?

Question 22

Misrepresentation by a party to the contract.

Answer 22

Miss representation must be made by a party to the contract or a an agent

Question 23

An agent

Answer 23

1) requires relevant authority to conclude a contract and must have made the misrepresentation while contracting.

2) Misrepresentation by an independent third party, the only action is against the third party, and it’s based
on delict.

Question 24

Intention to induce the contract

Answer 24

1) The misrepresentation must be made with an intention of inducing the contract.

2) The possibility that the party would believe and act on misrepresentation must be foreseen.

3) Misrepresentation must be made with the intention of inducing the other body to contract and must have resulted in him doing so

Question 25

Induced contract

Answer 25

If party would have contracted irrespective of the existence of misrepresentation, then, NO Recission

2) The misrepresentation itself must have persuaded the party to enter into the contract.
2.2) See Bird v Murphy

3) Party may obtain rescission and restitution for a causal misrepresentation but NOT for an incidental one.

4)Causal misrepresentation —misrepresentation which results in a contract being formed.

5) Incidental misrepresentation —misrepresentation which does not induce the contract but results in less advantageous terms for a party

Question 26

List the 3 types of misrepresentation

Answer 26

1. Intentional fraudulent misrepresentation
2. Negligent misrepresentation
3. Innocent misrepresentation

Question 27

Fraudulent misrepresentation is made intentionally and caused the representee
to enter into the contract, it has a purpose to persuade the other party to
conclude the contract, how is this done. List 3

Answer 27

1) Knowingly or

2) Without honest belief in its truth

3) Recklessly, carelessly whether it should be true of false

Question 27

Intentional fraudulent misrepresentation.

Answer 27

1) Representation of a false fact made fraudulently, which was believed
by the representee and was one of the factors inducing him/her to contract.

2) Misrepresentation made with the intention of persuading the other party to
conclude the contract

Question 28

Fraudulent misrepresentation renders the contract valid

Answer 28

1) Renders the contract void