WJEC Eduqas A Level Law Book 2 sample

Misrepresentation and economic duress 25 Misrepresentation Definitions: • a false statement in a contract that can cause the contract to be voidable • a statement of material fact made by one party to a contract to the other party during the negotiations of the contract which was intended to operate and did operate as an inducement to the other party to enter the contract, but which was not intended to be a binding obligation under the contract, and which was untrue or incorrectly stated Fraudulent misrepresentation Fraud must be proved: Derry v Peak (1889) but overturned by Companies Act 2006 Remedies: • Damages according to tort measure of deceit • Damages under s2(1) Misrepresentation Act 1967 • Equitable remedy of rescission Negligent misrepresentation Hedley Byrne principle: Hedley Byrne v Heller & Partners (1964) Three requirements: 1. Knowledge 2. Proximity 3. Reliance Remedies: • Damages according to tort measure of negligence • Damages under s2(1) Misrepresentation Act 1967 • Equitable remedy of rescission Innocent misrepresentation Misrepresentation Act 1967 : only claims where a party believes their untrue statement to be true Remedies: • Equitable remedy of rescission • Damages under s2(1) Misrepresentation Act 1967 Misrepresentation under statute Section 2(1) Misrepresentation Act 1967 • No need to prove fraud or special relationship under the Hedley Byrne criteria • Person making statement must prove they were not negligent • Howard Marine and Dredging Co Ltd v A Ogden and Sons (Evacuations) Ltd (1978) and Spice Girls Ltd v Aprilla World Service (2002) Section 2(2) Misrepresentation Act 1967 : Judge decides remedy Economic duress Extreme coercion renders contract commercially unviable (economic duress) Five conditions: 1. Pressure on contracting party: North Ocean Shipping Co v Hyundai Construction Co (1979) (The Atlantic Baron) 2. Illegitimate pressure: Atlas Express Ltd v Kafco (Importers and Distributors) Ltd (1989) 3. Pressure induced claimant to enter contract: Barton v Armstrong (1975) 4. Claimant had to enter contract: Universe Tankships v International Transport Workers’ Federation (1983) 5. Claimant protested quickly: North Ocean Shipping Co v Hyundai Construction Co (1979) (The Atlantic Baron) Summary: Misrepresentation and economic duress