Contract Glossary
Fraudulent Misrepresentation
Definition
A false statement of fact made knowingly (or recklessly) to trick someone into entering a contract. If you relied on the lie and suffered harm because of it, you can void the contract and sue for damages.
In Practice
Say a seller tells you a business earns $500,000/year in revenue, you buy it based on that, and the real number is $200,000. That's fraudulent misrepresentation, the seller lied about a material fact, knew it was false, and you relied on it. You can rescind the deal and pursue damages for your losses.
Common in these contract types
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