What Is Proving Misrepresentation?
It refers to the burden of proof laid on the plaintiff to give substantial evidence that defendant misrepresented information which caused some sort of loss.3 min read
2. What Must Be Proven?
3. Misrepresentation vs Fraud
4. What Is a Fraudulent Misrepresentation in Contracts?
Proving misrepresentation refers to the burden of proof laid on the plaintiff to give substantial evidence that the defendant misrepresented information which hurt the plaintiff or caused him some sort of loss.
What Is Misrepresentation?
Misrepresentation falls under the larger umbrella of fraud. Such claims are recognized in most courts throughout the country. A claim of misrepresentation states that the defendant caused harm to the plaintiff and should be held liable for the damages. The defendant can be held liable under these claims even if he didn't intend harm or loss through his actions.
Other names for misrepresentation include:
- Innocent misrepresentation
- Negligent misrepresentation
What the court calls this type of claim depends mostly on where the case is heard.
What Must Be Proven?
The plaintiff has to show evidence that a material fact was misrepresented in such a way that the plaintiff agreed to a contract he didn't intend to agree to. This fact must have been false when the agreement was formed.
The injured party also has to prove that he wouldn't have agreed to the terms of the contract if the misrepresented information had been truthful or not included at all.
Loss or injury to the plaintiff and benefit to the defendant also must be shown. If a contract was formed under misrepresented information, but no one was hurt and no one benefited, the court basically takes a "no harm done" approach.
Misrepresentation vs Fraud
Even though misrepresentation falls into the category of fraud, they do have some differences. Fraud usually assumes intent on the part of the defendant.
- Innocent misrepresentation is claimed when the defendant didn't know that the information he included in the agreement was false.
- Negligent misrepresentation is claimed when the defendant simply didn't try to determine whether the information was true or not.
- Fraudulent misrepresentation is claimed when the defendant intentionally falsified the information for his benefit or knew it was false.
Consider an example. Say an individual is purchasing a car. The car owner assures the buyer that the brakes are in great shape and safe. The buyer purchases the car and drives away only to end up in an accident due to faulty brakes. When the car is examined after the accident, it is found that the brakes were old and severely worn.
If the buyer chooses to sue the original owner of the vehicle for damages, he will need to prove some form of misrepresentation. The buyer can prove fraud if there is evidence that the owner was well aware of the condition of the brakes but explicitly said they were in good shape.
Misrepresentation may be proven if the buyer can show that the brakes were, in fact, in poor shape when the owner sold the car saying that they were fine. The buyer can show his bodily injuries and loss of a working vehicle as damages and the money paid to the original owner as the benefit.
In some cases, the plaintiff must be able to prove that they lost more than the defendant gained in order to prove misrepresentation. Some states allow for misrepresentation even if the loss was greater than the gain.
What Is a Fraudulent Misrepresentation in Contracts?
Contracts are only enforceable if the parties involved all agree to the terms and conditions included.
Usually, if any of the terms in a contract are false, the contract is considered invalid because it is based on inaccurate information. Information that is intentionally falsified is called fraudulent misrepresentation.
False information in a contract can still be considered misrepresentation even if the party who included the information was unaware that it was inaccurate. This is especially true if the party that included the false information was careless in their formation of the contract. Contracts are legally binding agreements that should be taken seriously.
Any time a party in an agreement includes information simply to get the other party to agree to his terms without checking to make sure that all of the facts are true, he may be able to be held liable for misrepresentation.
Under contract law, parties can only be held liable for misrepresentation if the false information negatively affected the agreement or other party somehow. For instance, if a party included the wrong middle name in a contract but no harm was caused to the other party, the contract is still considered valid and no one can be taken to court over a misrepresentation claim.
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