Remedies for innocent misrepresentation

Question 1

Rescission

Answer 1

Parties returned to position they were in before the contract was made
Not available if:
- Restitution to original position is impossible
- Contract is affirmed
- Delay
- 3rd party gained rights over property

Question 2

Clarke v Dickson

Answer 2

Restitution to original pre-contract position is impossible

• Misled into becoming partner, couldn’t end partnership, as firm became limited company

Question 3

Long v Lloyd

Answer 3

Contract is affirmed

Lorry broke down after buying, D offered to pay half, it broke down again
Can’t rescind contract, showed willingness to continue contract

Question 4

Leaf v International Galleries

Answer 4

Delay

Bought picture, told from famous artist,
5 years later found out it was a lie
Delay, so can’t rescind

Question 5

Lewis v Averay

Answer 5

A third party has gained rights over the property

Sold car, paid with cheque, cheque was worthless
Fraudster sold car onto innocent third party, can’t claim, would be unfair on third party

Question 6

Remedy of damages

Answer 6

No right to damages for innocent misrepresentation

S2.2 Misrepresentation Act 1967 - court can award damages