These days, it’s easier than ever to do due diligence on the parties with whom a business enters into a contract. Nonetheless, some individuals and businesses don’t disclose everything they should or present themselves as being qualified to do the job they’re being contracted to do when they aren’t.
This can be considered “fraudulent misrepresentation.” It can involve not being fully truthful or outright lying about anything that is material (relevant) to the contract into which they’re entering. Lack of disclosure of relevant information can also be considered fraudulent misrepresentation.
Types of false misrepresentation
If misrepresentation (whether in writing or verbally) is intentional and it ultimately causes harm to a business, that business can take legal action. Sometimes, even when someone makes assertions that they’re not certain are true, that can be considered fraudulent misrepresentation.
One example of fraudulent misrepresentation could be a contractor saying that they’re licensed when that licensed has lapsed or been revoked. A vendor failing to disclose an impending recall on a product they sell a business could potentially be sued for fraudulent misrepresentation. A company might claim that they serve more businesses in the state than any of their competitors when they don’t actually have the facts to back that up. As noted, the plaintiff would need to show that they suffered financial harm as a result of the misrepresentation.
Recovering losses and damages
There are several ways to recover losses and other damages in a fraudulent misrepresentation suit. By getting the contract voided, the plaintiff can seek to get any money already paid back and owe nothing further. They can seek to recover money they lost. For example, a business may have to pay more to get a project done with a quick turnaround time because of the time lost by the using a contractor who misrepresented himself. If the misrepresentation was done to cause harm or was particularly egregious in some other way, a Texas plaintiff might also be able to sue for punitive (exemplary) damages.
It’s crucial for anyone who believes they have a fraudulent misrepresentation case to get legal guidance as soon as possible. This can help stop further losses and damages – particularly if the work isn’t yet finished or other terms of the contract aren’t yet fulfilled. Experienced guidance can also help protect a plaintiff’s rights under the law.