CONTRACT ASSESSMENT 2

Contract Substitute Assessment 2



Contract Substitute Assessment 2

Case A

In case of Rother and FarSite, Rother misrepresented the facts of the land which he sold to FarSite. The company has initiated an inquiry about the commercial usage of land owned by Rother to which Rother responded that the as he have heard from the local news the government is willing to initiate the development in the area. This is a clear case of Misrepresentation. Misrepresentation is a legal concept which explains that the there has been miscommunication in terms of false statements or false facts made by another party in order to induce it into entering a contract. Misrepresentation of facts either made by conduct of the party entering into the contract or by the conduct of the party is deemed misrepresented and individuals. If there is misrepresentation or manipulation of the facts in the contract then the other party, which has been induced to make a contract have full right to sue the person, who had made false claims, by pressing charges against any damages or may recede the contract.

Misrepresentation in a contract occurs primarily due to withholding the information pertaining to the subject of the contract or knowingly deceiving the other party so that it may enter into a contract. Misrepresentation may be unknowingly and unwillingly by the person due to incomplete information or unsubstantial source of information. In both the cases the contract is subjected to misrepresentation of information and it may be receded or the affected party may press charges against the false claimer.

Misrepresentation is one of the factors which are primarily responsible for the rescission of a contract. The contract will be falling under the category of misrepresentation if any of the following criteria's have been fulfilled.

A false claim has been made based on the past or existing information.

The false claim / Statement affected the party who is pressing charges.

The suing party has been induced to enter into a contract because of false statement.

Distortion of fact constitutes that the fact has not been placed effectively. The fact has either been distorted or is not presented properly to the affected the party. The seller of the article may only disclose half of the facts and withholds the rest. Distortion in presenting the fact may significantly alter the contract which has several consequences on the affected party.

Misrepresenting while acting for benefit for another party constitutes misrepresentation and individual can sued against for not clearly stating the facts which are proposed by the individuals.

Following are the types of misrepresentation

Fraudulent misrepresentation is the type of misrepresentation which has been primarily intended in order to deceive the other party. The action which can be taken against the fraudulent misrepresentation is rescission of the contract as well suing for the damages. It can also be sued against the tort action. Fraudulent representation can also be categorised as recklessness of the individual.

Negligent misrepresentation is made when the defendant has made the representation carelessly and ...