Payton & Associates, LLC
Commercial Litigation Attorneys
Miami, Florida

What is fraudulent misrepresentation in contract disputes?

When businesses in Florida interact with other businesses and individuals, generally it is done through contracts. The parties to the contract agree to do certain things in exchange for something else, and when the parties reach an agreement it is generally then written down and the parties will sign a formal contract. When businesses enter into these contracts though, they have to have some assurances that the other party is capable of doing what they are agreeing to do.

The business could do some independent investigation, but there are many times when one party simply relies on the representations of the other party when entering into a contract. So, they expect that the representations are true. However, there are many times when the representations may be false, and sometimes the party may purposefully misrepresent facts to induce the other party into signing the agreement. These are known as fraudulent misrepresentations. When a fraudulent misrepresentation occurs, the aggrieved party may want to pursue a fraud claim.

There are certain requirements that must be met in order to prove a fraudulent misrepresentation. There must be a representation made to the other party, which the party making it knew was false or was made without knowing whether it was true or not. Then the party must demonstrate that the party making the misrepresentation intended the other party to rely on it, and the other party did in fact rely on the misrepresentation. Finally, the party relying on the misrepresentation must have suffered damages as a result.

Businesses in Florida enter into contracts every day. They are an essential part of business and generally are binding once signed by the parties. However, prior to signing the contract there can be negotiations in which both parties will provide assurances to the other that they will fulfill their obligations. So, when the representations are false it can leave the other party in a very difficult position. However, there are remedies to fraudulent misrepresentations. Those wishing to learn more about the remedies available to them will want to seek the professional guidance needed to have a better understanding of this area of law.

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