Contract law - misrepresentation

Question 1

What is misreperesentation?

Answer 1

an untrue statement of fact made before/at time of contract being made which indices another party to enter the contract causing a loss.

Question 2

Define the types of misrepresentation;
- fraudulent
negligent
-innocent

Answer 2

Fraudulent - knowingly
Negligent - statement was believed to be true but without reasonable grounds for belief. remedy under torts not contract so dont need to prove a contract existed.
Innocent - statement made beleiving it to be true and with grounds to believe this.

Question 3

Use Spice girls v Aprilla world service as evidence for how code of conduct can be seen as misrepresentation?

Answer 3

Sponsors refused to pay them as one member left which changed what had been promised. Group knew the sponsors were relying on each individuals characteristics so liable to damages.

Question 4

What does the Bisset v Wilkinson case prove?

Answer 4

Should be statement of fact not opinion, when asked how many sheep land might hold the defendant estimated and it was held it was statement of opinion.

Question 5

Use Atwood v Small to show how misrepresentation must induce party to enter contract?

Answer 5

Claimant agreed to purchase estate subject to satisfaction of reports. Despite reports being exaggerated, he checked them himself so wasnt able to rescind the contract.

Question 6

When is silence rendered misrepresentation - support with case?

Answer 6

O’Flannagan - failure to disclose change in circumstances

Question 7

What is the burden of proof for-
a)fraudulent misrep
b)negligent misrep

Answer 7

a) must prove beyond reasonable doubt
b)must prove misrepresentation , burden falls on defednant balance of probabilities that they believed the statement when made (success turns it to innocent misrep)

Question 8

What are the remedies for misrep?

Answer 8

Remedies - aims to put party in pre contractual position, if avoided then party has to repay money to party that avoided the contract, if affirmed then not owed anything (lose rights to recision and if not done in reasonable time frame) e.g Leaf v International Galleries proves that if pre contractual position cant be restored, recision is not possible or if third party has acquired the rights.
Indemnity - put parties in position as if contract never existed, not if damages liable
Damages - awarded for innocent misrep instead of rescindment, fraudulent - can recover all direct losses if couldnt forsee losses

Question 9

Will the contract be void,voidable or valid if cntract enrtered into under duress? What is assumed?

Answer 9

voidable, assumed one party is always more dominant (which is classified as undue influence)

Question 10

What should be considered in claims of duress?
Use Atlas Express v Kafco as evidence.

Answer 10

Did the person protest
was alternative course of action available
did they seek advice
did they take steps to avoid the contract.
AE v K - K had to agree udner duress as had no other options and would have gone bankrupt