Fraudulent Misrepresentation in UK Law

Leading Cases
  • Smith New Court Securities Ltd v Scrimgeour Vickers (Asset Management) Ltd and Another
    • House of Lords
    • 21 Nov 1996

    But in cases where property has been acquired in reliance on a fraudulent misrepresentation there are likely to be many cases where the general rule has to be departed from in order to give adequate compensation for the wrong done to the plaintiff, in particular where the fraud continues to influence the conduct of the plaintiff after the transaction is complete or where the result of the transaction induced by fraud is to lock the plaintiff into continuing to hold the asset acquired. But in cases where property has been acquired in reliance on a fraudulent misrepresentation there are likely to be many cases where the general rule has to be departed from in order to give adequate compensation for the wrong done to the plaintiff, in particular where the fraud continues to influence the conduct of the plaintiff after the transaction is complete or where the result of the transaction induced by fraud is to lock the plaintiff into continuing to hold the asset acquired.

  • Doyle v Olby (Ironmongers) Ltd
    • Court of Appeal (Civil Division)
    • 31 Jan 1969

    In contract, the damages are limited to what may reasonably be supposed to have been in this contemplation of the parties. The defendant is bound to make reparation for all the actual damages directly flowing from the fraudulent inducement. All such damages can be recovered: and it does not lie in the mouth of the fraudulent person to say that they could not reasonably have been foreseen.

  • Diamond v Bank of London and Montreal Ltd
    • Court of Appeal (Civil Division)
    • 07 Nov 1978

    The truth is that each tort has to be considered on its own to see where it is committed. Such as in Distillers Co. (Biochemicals) Ltd. v. Laura Anne Thompson. In the case of fraudulent misrepresentation it seems to me that the tort is committed at the place where the representation is received and acted upon; and not the place from which it was sent. Logically, it seems to me, the same applies to a negligentmisrepresentation by telephone or by telex.

  • Dadourian Group International Inc. (a company incorporated under the Laws of the State of New York) and Others v Azuri Ltd
    • Chancery Division
    • 14 Nov 2007

    It does not follow that B should be liable for contractual damages to A where the contract which he procured was one between A and C, even where C is the creature of B. To put the point another way, where in that example the principle of corporate separation exemplified in Salamon v A Salamon & Co Ltd [1897] AC 22 would apply absent a misrepresentation by the person controlling the company, there is no need, and it would be inappropriate, to lift the veil in order to provide A with a contractual remedy against B; A recovers all his loss arising as a result of the misrepresentation by his tortious claim in deceit.

    Charlton, if it was being used as a device at all, was being used to hide the involvement of Jack and Helga and, if that concealment had not taken place, the Option Agreement would not have been entered into. There is simply no need, in order to give the Claimants redress for that misrepresentation, to lift the veil at all: indeed, to do so would achieve nothing in relation to that wrong.

  • Armagas Ltd v Mundogas SA (The Ocean Frost)
    • House of Lords
    • 22 May 1986

    They do not exist where such belief, although it is present, has been brought about through misguided reliance on the servant himself, when the servant is not authorised to do what he is purporting to do, when what he is purporting to do is not within the class of acts that an employee in his position is usually authorised to do, and when the employer has done nothing to represent that he is authorised to do it.

  • Saunders v Edwards
    • Court of Appeal (Civil Division)
    • 13 Mar 1987

    Where the plaintiff's action in truth arises directly ex turpi causa, he is likely to fail, as he did in Alexander v. Rayson, [1936] 1 King's Bench 182; J.M. Allan (Merchandising) Ltd v. Cloke, [1963] 2 Queen's Bench 340; Ashmore, Benson, Pease & Co, Ltd. v. A.V. Dawson Ltd. [1973] 1 Weekly Law Reports 828; and Thackwell v. Barclays Bank plc, [1986] 1 All England Reports, 676. Where the plaintiff has suffered a genuine wrong, to which allegedly unlawful conduct is incidental, he is likely to succeed, as he did in Bowmakers Ltd. v. Barnet Instruments Ltd.

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Legislation
  • National Insurance (Industrial Injuries) Act 1946
    • UK Non-devolved
    • January 01, 1946
    ......in consequence of the non-disclosure or misrepresentation by the. claimant or any other person of a material fact (whether the. disclosure or misrepresentation was or was not fraudulent). . (2) Any assessment of the extent of the disablement resulting. from ......
  • Sale of Goods Act 1979
    • UK Non-devolved
    • January 01, 1979
    ......as fraudulent by the buyer. . (6) Where, in respect of a sale by auction, a right to ...and agent and the effect of fraud, misrepresentation, duress. or coercion, mistake, or other invalidating cause, apply to. ......
  • The Consumer Protection from Unfair Trading Regulations 2008
    • UK Non-devolved
    • January 01, 2008
    ......"port") omit the words from "Provided that" to the end. . Fraudulent Mediums Act 1951 . 3. The Fraudulent Mediums Act 1951.  14 shall cease ...  26 (misrepresentation) shall cease to have effect. . Airports Act 1986 . 32. In section 74 of ......
  • Age of Legal Capacity (Scotland) Act 1991
    • UK Non-devolved
    • January 01, 1991
    ......to enter by virtue of any fraudulent misrepresentation. by the applicant as to age or other material fact;. . ......
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Books & Journal Articles
  • Houldsworth v. City of Glasgow Bank
    • Nbr. 19-1, January 1956
    • The Modern Law Review
    ...... induced to subscribe for shares on the faith of a fraudulent statement in a company prospectus cannot sue the company for ... the company for damages for the fraudulent misrepresentation inducing the share subscription, when it is too 1 (1950) 18 ......
  • Measures in Misrepresentation: Recent Steps in Awarding Damages
    • Nbr. 55-5, September 1992
    • The Modern Law Review
    ...... As is well known, at common law the courts had only allowed damages for fraudulent misrepresentation in the tort of deceit'; the only remedy for innocent or negligent misrepresentation was rescission of the contract, ......
  • Authorised Acts and Appropriation
    • Nbr. 55-2, March 1992
    • The Modern Law Review
    ...... in the present case was voidable because of the fraudulent misrepresentation. Property acquired under a voidable contract was ......
  • Navigating trans‐atlantic deals: warranties, disclosure and material adverse change
    • Nbr. 15-4, November 2007
    • Journal of Financial Regulation and Compliance
    • 472-481
    Purpose: The purpose of this paper is to explore certain remaining differences in the underlying legal considerations and the differing customs and practices of US and UK mergers and acquisitions i...
    ...... for damages or seeking rescission ab initio under the Misrepresentation Act 1967. Accordingly, a seller will seek to exclude tortious remedies and ...New York courts may bar both fraudulent and non-fraudulent misrepresentation claims where the contract contains a ......
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