Types of Misrepresentation

Question 1

different types of misrepresentation

Answer 1

innocent
negligent
fraudulent
(each have different remedies)

Question 2

innocent

Answer 2

Misrepresentation Act 1967:
the misrep is genuinely held on reasonable grounds. the false statement is made honestly without negligence.

Question 3

negligent

Answer 3

negligent misstatement as a tort is the basis. when a person honestly makes a statement, but they have no reasonable grounds for believing it to be true.
statute s.2(1): no special relationship is required (as in tort). burden is on the person making the statement to prove they had reasonable grounds to believe it is true.

Question 4

fraudulent

Answer 4

fraudulent has origins in the tort of deceit.
Derry v Peek: fraudulent misrepresentation is when a statement is made without belief in the truth.
includes when a person making the statement knows it to be untrue or are reckless as to whether it is true or not.

Question 5

Howard Marine v Ogden and Sons on negligent misrepresentation

Answer 5

facts: Ogden hired 2 barges from Howard Marine to carry out dredging work, asked the capacity of the barges, Howard had the relevant documents but checked a registry which stated 850 cubic meters.
held: The registry was correct, they held documents stating the capacity, so the argument failed.

Question 6

Derry v Peek on fraudulent misrepresentation

Answer 6

facts: Tramway leaders falsely claimed legal permission for steam power in a document. A shareholder, relying on this, accused them of deceit when the permission was denied, causing the company’s closure. The leaders defended themselves, insisting they honestly believed the statement in the document.
held: Not fraudulent, as the defendant believed approval was certain.