Misrepresentation

Misrepresentation is a false statement of material fact that induces another party to enter into a contract or to take a particular action. It can arise in contract law, tort law, and consumer protection contexts, and it may involve different levels of culpability or fault.

There are three commonly recognized categories. Fraudulent or intentional misrepresentation requires that the misstatement be knowingly false or made with reckless disregard for the truth, with the intent to induce reliance. Negligent misrepresentation involves a duty of care to verify the truth and a breach of that duty, leading to reliance and damages. Innocent misrepresentation occurs when the statement is false but the maker believes it to be true and has no intent to deceive. The legal remedies and availability of damages vary by jurisdiction and by category, but rescission of the contract is a typical remedy across all forms, with damages more readily available for fraudulent and, in some cases, negligent misrepresentation.

Elements commonly required include: a false statement of material fact (not typically a statement of opinion or a statement of law), reliance by the other party, and resulting damages or harm. Some jurisdictions restrict liability for statements of opinion unless the speaker has superior knowledge or fiduciary duty. In advertisements and consumer deals, misrepresentation is often addressed by statutory consumer protection laws and may carry additional remedies, such as statutory damages or remedies beyond those at common law.

Examples include misrepresenting the condition of a property, the features of a product, or the terms of an insurance policy. Misrepresentation differs from mere breach of contract and from disclosure failures, though nondisclosures can also be actionable if material and misleading.