Actionable misrepresentation and negligent misstatement

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The Practice Notes in this subtopic consider claims brought for misrepresentation (whether innocent, negligent or fraudulently made) and for negligent misstatement and the tort of deceit; and the various exclusions of liability, defences and remedies that may be available.

What is a misrepresentation and comparison with similar claims

A claim for misrepresentation arises where one party to a contract (the representor) made an untrue statement of fact that induced the other (the representee) to enter into the contract.

Claims for misrepresentation are governed by both the common law and the Misrepresentation Act 1967 (MA 1967).

Where there has been a misrepresentation, the representee has a right to rescind the contract whether the misrepresentation was made:

  1. •

    fraudulently—where the misrepresentation was made knowingly, without belief in its truth, or recklessly as to its truth. The claimant may have the contract rescinded and seek damages

  2. •

    negligently—where the misrepresentation was made carelessly or without the representor having reasonable grounds for believing its truth. Under MA 1967, s 2(1) the claimant may seek rescission and/or damages

  3. •

    innocently—where a misrepresentation was made but the representor can show

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