What is Negligent Misrepresentation?
Negligent misrepresentation is a concept that arises in contract law. In general, misrepresentation refers to a situation in which someone makes a false statement for the purpose of making a deal, resulting in the person who relies on the statement experiencing harm. In the case of negligent misrepresentation, someone makes a statement without any grounds for knowing whether it is true or not, and an aspect of carelessness is involved. If a car dealer claims that it believes the previous car owner changed the oil without actually knowing it to be true, it may be committing this type of misrepresentation.
This differs from innocent and fraudulent misrepresentation. In innocent misrepresentation, someone making a statement believes that a statement is true when it is not. This person may be relying on outdated information or incorrect information from someone else, which that person has reason to believe is true. In fraudulent misrepresentation, the statement is a lie and someone knows that it is a lie or disregards evidence that it is a lie.
Misrepresentation in a contract does not necessarily provide grounds for a suit. In the example of a car dealer above, if the customer bought the car and the oil had not been changed regularly but no damage was caused, the customer cannot later sue the dealer. The customer has suffered no harm as a result of the false statement. If, on the other hand, the engine seizes because the oil was never changed, the buyer can sue the dealer because the buyer has suffered harm.
The law is also careful to distinguish between misrepresentation and what is known as “puffery.” Puffery is language that is generally understood to be subjective and not intended to be understood literally. When a dealer says “this is a great car to drive,” this is an example of puffery, and the buyer cannot later sue on the grounds that it is not a great car to drive. If, on the other hand, the dealer says “the steering on this car is very responsive” and it is not, this may be considered misrepresentation because it is a statement that appears factual but is actually false.
People can avoid engaging in negligent misrepresentation by verifying the facts before they speak; if a waiter is asked, for example, if a dish contains tomatoes, the waiter can say “let me check with the kitchen.” Misrepresentation is a common situation when people feel under pressure to close a deal and negligence often happens when someone makes a statement carelessly in the heat of the moment. Telling a buyer “not to my knowledge, but I can check on that” will often provide time to verify the facts without losing the deal.
I recently leased a new car and needed to insure it within 30 days. I decided to go through my current auto and home owners insurance company because I liked them and had multiple policies and thought I would receive additional discounts, etc.
First, they quote me $71 a month, then the next day they called me, saying it will be $88 a month, but the insurance on my other car will go down. Now, after receiving the bills, I see that my insurance on my older car is higher than what was quoted, along with my insurance on the new car being much higher than even the secondary quote.
I feel these people have misrepresented themselves and done me a great disservice. I wonder if legal action is the next step?
I'm in the process of closing on a building and the listing said that the roof had been replaced. Upon
inspection, I found out the roof had not been replaced but repaired, and has soft spots. I purchased it from a "bank as is."
I knew I was purchasing "as is," but with a new roof. Do I have any recourse other than to back out of the deal?
Bhutan - Wow that is really a shame. I know that there was a legal misrepresentation in a condo development in Miami Beach.
The condo owners were faithfully paying their maintenance dues but the money was not going to repair the building which developed unsafe structural problems.
The board was defrauding condo owners so long and let go of the maintenance of the building for such a long time that now the building is uninhabitable and the residents are were recently given an assessment of $40,000 each.
On top of that the residents had to relocate until the building was safely repaired which meant that they were not only having to pay their mortgage and maintenance dues, but they also had to pay for another place to live.
It was a nightmare. I really felt bad for these people because they thought that their dues were going to the right place. I wonder if this is a case of negligent entrustment?
BambooForest - What I think is worse is the poor people who bought in some newly constructed developments in Florida that were constructed with Chinese drywall.
As a result of this drywall many homeowners became sick and had to leave their homes because the drywall had to be repaired. Many homeowners in South Florida felt that it was a legal misrepresentation and sought negligent lawsuits.
It was really a shame because many of these homes were so beautiful but unfortunately were uninhabitable.
@elizabeth23, I had that problem often in college, when eating in the cafeteria. I would occasionally go to the "home" line in the cafeteria, knowing it usually had meat. However, occasionally it would be a dish that sounded vegetarian, and when I asked they would say it was. However, my friends and I caught on that sometimes a dish made without meat would be replaced with meat halfway through the dinner shift, causing a friend to get sausage when mine had been made just with beans, for example. It drove us crazy, because the server usually didn't know/ask when the food they were dishing got changed.
I hate when I go to a restaurant and foods are presented as vegetarian which are cooked with meat stock or the waiter or waitress is not sure what does or does not have meat, especially things like fish or shellfish, which can cause severe allergies. It needs to be taught better to staff, and they need to know how and when to consult a chef or manager if they themselves are not sure.
A lot of advertising is negligent misrepresentation, but it usually is so close to puffery there is very little the customer can do. For example, almost every food marketed to children says it is "part of a healthy, filling breakfast", "a nutritious snack", or "part of a child's healthy diet". Most of this is untrue, but it's hard to argue with. However, if it makes a specific claim- like helping prevent a child getting sick or helping to increase someone's bone density, growth, or another such visible difference- that can be brought to court for false advertising.
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