Misrepresentation case

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Echo1992
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#1
Report Thread starter 7 years ago
#1
The Meadows Council received a notice in Dec 2013 from the state government of water-supply plan in regard to an area marked on the shire plan as "Zone A"
Jenny was thinking of purchasing five acres for a sheep farm. While investigating the suitability of the land for sheep farming, she approached Meadows Council for information and advice. Steve, a land surveyor in the employ of the Council advised all land was "agriculture use only". He advised the zoning would not be altered. Steve failed to notice that the State Governments notice was attached to the Council area map.
Jenny purchased property and spent considerable money on erecting fences and sheep pens.
Half way through the process, Jenny received a notice from the State Government to cease building activities as the Government was to acquire the land to build a dam.
What right does Jenny have in these circumstances.

What should i concerned in this case? Only negligent misrepresentation or something others?
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#2
Report 7 years ago
#2
Do you mean negligent misstatement? Presumably Jenny didn't buy the land from the council.
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Echo1992
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#3
Report Thread starter 7 years ago
#3
(Original post by Forum User)
Do you mean negligent misstatement? Presumably Jenny didn't buy the land from the council.
I do not understand what is the different between negligent misstatement and negligent misrepresentation? Can you explain it? thanks a lot!
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#4
Report 7 years ago
#4
Okay, potted version since I haven't done 'basic contract' in ages and am quite rusty on it! I'd recommend looking in a basic textbook that might explain it more clearly than I can.

A misrepresentation is an untrue statement made by one party to the contract by the other that induces that other to enter into the contract. The basic remedy for misrepresentation is rescission - i.e. the contract is 'undone', with both parties giving back what they gained under it (although damages may also be/instead be available in various circumstances).

A negligent misstatement is an untrue statement made without reasonable care, by one party to another that causes that other loss, in a situation where it was reasonable for that other to rely on the statement. The basic remedy would be damages.

Notice that the remedy and the definition go well together. Where it is one party to the contract who has made the untrue statement, it is reasonable to allow the other party to 'get out of the bargain'. But that would be pretty ridiculous if the person making the untrue statement had nothing to do with the contract at all, which is often the case with a negligent misstatement. So in your example:

1) If Jenny buys land from Fred, and Fred makes an untrue statement about it, then Jenny can rescind the contract, give the land back, and get the purchase price back, generally.

2) If Jenny buys land from Fred, and Meadows Council makes an untrue statement about it, which Fred did not know about, then it would obviously be unfair on Fred to allow Jenny to rescind the contract and get her money back, right? Jenny's remedy, if any, will have to be against Meadows Council.

Misrepresentation only comes up where there is a contract between the statement gives and the person induced by it. For negligent misstatement, there does not need to be a contract between the person giving the statement and the person relying on it, the claim is in tort and totally independent of any contract. Indeed, if there is a contract between the two parties then it will usually be easier for the injured party to sue for breach of contract and not misstatement.
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Echo1992
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#5
Report Thread starter 7 years ago
#5
(Original post by Forum User)
Okay, potted version since I haven't done 'basic contract' in ages and am quite rusty on it! I'd recommend looking in a basic textbook that might explain it more clearly than I can.

A misrepresentation is an untrue statement made by one party to the contract by the other that induces that other to enter into the contract. The basic remedy for misrepresentation is rescission - i.e. the contract is 'undone', with both parties giving back what they gained under it (although damages may also be/instead be available in various circumstances).

A negligent misstatement is an untrue statement made without reasonable care, by one party to another that causes that other loss, in a situation where it was reasonable for that other to rely on the statement. The basic remedy would be damages.

Notice that the remedy and the definition go well together. Where it is one party to the contract who has made the untrue statement, it is reasonable to allow the other party to 'get out of the bargain'. But that would be pretty ridiculous if the person making the untrue statement had nothing to do with the contract at all, which is often the case with a negligent misstatement. So in your example:

1) If Jenny buys land from Fred, and Fred makes an untrue statement about it, then Jenny can rescind the contract, give the land back, and get the purchase price back, generally.

2) If Jenny buys land from Fred, and Meadows Council makes an untrue statement about it, which Fred did not know about, then it would obviously be unfair on Fred to allow Jenny to rescind the contract and get her money back, right? Jenny's remedy, if any, will have to be against Meadows Council.

Misrepresentation only comes up where there is a contract between the statement gives and the person induced by it. For negligent misstatement, there does not need to be a contract between the person giving the statement and the person relying on it, the claim is in tort and totally independent of any contract. Indeed, if there is a contract between the two parties then it will usually be easier for the injured party to sue for breach of contract and not misstatement.

Got it, Thanks!
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