Misrepresentation

In one sentence

A false statement of fact made to induce someone into a contract.

Plain English

Misrepresentation is when one party makes a false statement about an important fact to get the other party to sign. The statement can be intentional or innocent (the speaker might not know it's false). If misrepresentation is proven, the injured party can usually cancel the contract and recover damages.

Ad slot

Example

A used car dealer tells a buyer the car has never been in an accident, when in fact it was totaled and rebuilt. The buyer relies on this statement and buys the car. The buyer can later sue for misrepresentation and either rescind (cancel) the sale or recover money for the car's actual lower value.

Used in a sentence

“The seller's misrepresentation about the property's foundation defects gave the buyer grounds to cancel the deal.”

Related terms

Fraudulent Misrepresentation

A deliberate false statement made with intent to deceive and cause harm.

Mistake of Fact

A misunderstanding about something that actually exists or happened, rather than about the law itself.

Implied Warranty

An unspoken legal guarantee that a product is fit for its ordinary purpose and of acceptable quality.

Damages Calculation

The process of determining how much money a harmed party should receive for a breach.

Rescission

Unwinding a contract entirely, returning both parties to their positions before the deal.

Offer

A proposal to enter into a binding agreement on specific terms.

Acceptance

Agreeing to the exact terms of an offer, creating a binding contract.

Consideration

Something of value exchanged by each party to make a contract binding.

This page is a plain-English reference and is not legal advice. Laws vary by jurisdiction and change over time. For specific situations consult a licensed attorney.