Vitiating factors Flashcards
What is a “misrepresentation”?
A false statement of material fact by a party to the contract, that induces the other party to enter the contract
Case about what counts as a “statement” in misrepresentation
Spice Girls v Aprilia World
A “statement” doesn’t have to be written or verbal - it can be implied by actions. All five Spice Girls came to film a promotion video, knowing Geri was leaving - this made the video worthless to the sponsorship company when they released it
Case showing there is no general duty to disclose all facts before a contract
Fletcher v Krell (1873)
A governess didn’t say she was divorced before getting the job - but there was no duty on her to
When might there be a positive duty to disclose facts before a contract? (4 situations)
(1) When key facts have changed between you making a statement and the contract being completed
(2) When you’ve said something that’s a half-truth
(3) When there’s a relationship of trust
(4) In insurance contracts (contracts “of utmost good faith”)
Case showing you have to disclose when there’s been a change in circumstances between a statement and the contract formation
With v O’Flanagan (1936)
A doctor truthfully says the number of patients at his surgery. However, in the meantime many patients leave. The buyer buys his surgery on the basis of the old statement without knowing of the change of circumstances. Contract voidable
Case showing that telling a half-truth before a contract can be a misrepresentation
Dimmock v Hallett (1866)
A seller of land says, truthfully, that there were tenants on the land. This was what the buyer wanted. However, he didn’t complete that statement by saying that they were all about to leave
Case showing a misrepresentation through omitting to say something in a relationship of trust
Tate v Williamson (1866)
A financial adviser advises his client to sell lad for less than half its value. He doesn’t tell the client that he was actually intending to later buy the land. As a breach of trust, this was a misrepresentation
Case showing that statements of opinion, made by someone without any particular specialist knowledge, are not misrepresentations
Bisset v Wilkinson (1927)
Seller of land who had never had sheep was asked how many sheep he thought the land could have on it. He said he thought about 2,000. It turned out it could support a lot less. It was not a misrepresentation, because it was known the seller had no experience and was just offering an opinion
Case in which a seller says that the property is let to “a most desirable tenant”, when actually knowing that he owes money
Smith v Land and House Property Corp (1884)
This was a misrepresentation - it was more than a statement of mere opinion, and could count as a statement of fact
Case in which a person made a false statement of material fact, but it was not a misrepresentation because it did not induce the other party to enter the contract
Attwood v Small (1838)
Seller of a mine makes a false statement about the mine’s earnings. The buyer instructed the surveyor to confirm this statement, which he did (wrongly). The purchaser buys the mine. He can’t say the initial statement is a misrepresentation, because it didn’t induce him to enter the contract: the surveyor’s statement did
