Misrepresentation in Law

Misrepresentation is a statement made orally or in writing from one party to the other in order to induce the other party into entering into a contract. Like mistake, the presence of misrepresentation in the formation of a contract makes the contract void and unenforceable.

Types of Misrepresentation

Misrepresentation is basically of three types:

1. Fraudulent Misrepresentation
2. Negligent Misrepresentation
3. Innocent Misrepresentation.

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The Doctrine of Mistake at Law

Introduction to the Doctrine of Mistake

There is always a consensus ad idem (meeting of the minds) between parties that enter into a contract. What this means is that both parties to a contract are thinking of the same thing when they enter into a contract. Thus, when a party enters into a contract on a mistaken assumption of some fundamental facts, the consensus ad idem is lost. This then justifies the contract being voided for mistake.

To a layman, any obvious misunderstanding of the contract by either party could be categorized as a mistake. However this is not the case. Mistake in the law of contract only applies to fundamental facts that go to the root of the contract.

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