Trust and transparency form the foundation of most, if not all, contractual relationships. After all, if you can’t trust another party to adhere to the terms of an agreement, then breach is likely. However, breach of contract isn’t the only contractual issue that you might face in your business endeavors. Fraudulent misrepresentation can pose a huge problem for you and your business, and it can cause significant financial harm.
What is fraudulent misrepresentation?
Fraudulent misrepresentation involves making false or misleading statements in order to secure a contract. When one of these claims are made, certain legal elements have to be shown before the claim can succeed. Amongst them are:
- A representation that was actually made
- The representation was false or misleading
- The party that made that representation either knew it was false or had a reckless disregard for the truthfulness of the representation
- The statement was made with the intent of luring the other party into the contract
- The party that was lured into the contract relied on the false or misleading representation when deciding on whether to enter the agreement
- That reliance caused harm to the party that was lured into the contract
It might sound easy enough to resolve each of those elements, but each one of them can actually have multiple legal issues associated with them. For example, proving intent is typically going to require a party to show extrinsic evidence that demonstrates motive, and detrimental reliance is going to require the wronged party to show that there was some sort of financial harm caused by entering into the contract in question.
Secure help to deal with your contract issues
Contract disputes can be more complicated than you think. With so much on the line, you really can’t afford to give these matters anything less than your best advocacy. That can be a challenging thing to do, especially if you’re unfamiliar with the ins and outs of this area of the law. That’s why if you’re facing fraudulent misrepresentation or any other kind of contractual issue, then now may be the time to discuss your situation with an attorney who is experienced in successful in business law matters.