UNWITTING MISPRESENTATION
You must ensure all marketing and sales communications are not exaggerated but accurate and reviewed.
Check your Website too.
WHAT IS MISREPRESENTATION
This occurs when you, or your representatives make a false statement before a contract is formed and the other party relies on the statement. It must have influenced the decision to contract with you. This includes goods as well as services.
It can be made in writing, verbally and even implied through conduct.
CONSEQUENCES
Can be severe.
Damages are extensive and can result in real financial exposure. There can be criminal exposure. Damage to business reputation.
THE 3 TYPES
Fraudulent, negligent or innocent misrepresentation.
Fraudulent – knowingly false statement can also be made recklessly. Risk – highest risk of damages, contract rescission and potential criminal exposure.
Civil wrong in the Tort of Deceit and criminal under the Fraud Act 2006.
Negligent – statement made carelessly without reasonable grounds for believing it true. Risk – damages and reputation.
Innocent – you reasonably believe it true. Risk – contract set aside and damages.
WAYS TO REDUCE THE RISK
You need to ensure all statements, marketing, your website emails and communications (such as WhatsApp) are accurate.
Avoid exaggeration. Even minor inaccuracies can be a problem if someone relies on them.
Review – review contracts, website, promotional materials, and negotiation or sales processes.
Your website designers should consider recommending a legal review of your website including for legal compliance with all governing statutes and regulations.
Misrepresentation is only one exposure of several for your business.
[To discuss a review contact us at [email protected] or complete our contact form at www.alexanderBLS.com]Important – Whilst you cannot exclude liability for fraud, clear and consistent Terms & Conditions, and contracts reduces ambiguity, aids clarity and supports defendable practices.
KEY POINTS
Avoid what can amount to serious legal and reputational risk. Because the consequences can be severe and long lasting, treat all allegations seriously and respond in good time.
A careful review and taking the time to do so, can help reduce the risk of claims, protect your business and your reputation.
ALEXANDER BUSINESS LAW SOLUTIONS are lawyers for business and welcome enquiries.
Alexander Business Law Solutions is a member of Laurel Leaf Networking.
