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Mistake vs. Misrepresentation

Decent Essays

In brief: Mistake vs Misrepresentation • A mistake is inadvertent and only an error on the part of the person committing it while misrepresentation is often wilful or intentional, done with the intention of gaining wrongfully. The main difference between Mistake and Misrepresentation is that in the case of Mistake one or both parties to a contract or what was intended to be a contract unintentionally or unknowingly made statements not intended to mislead the other. Therefore fraud cannot be implied from these statements or circumstances. At Common law, a mistake can affect the validity of a contract “operative mistake”, making it null and void. In the case of misrepresentation, false statements of facts are required to be made which …show more content…

In 1963, the House of Lords stated, obiter, in Hedley Byrne Co Ltd v Heller Partners Ltd [1964] AC 465 that in certain circumstances damages may be recoverable in tort for negligent mis-statement causing financial loss. The liability depends on a duty of care arising from a “special relationship” between the parties. It is now clear that a party can claim damages under the principle in Hedley Byrne where a negligent mis-statement has induced him to enter a contract;

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