Chapter 16 Self-test questions

. Which of the following cannot give rise to a claim for misrepresentation?

Statement of fact

Statement of law

Representation by conduct

None of the answers given is correct

. A is in negotiations with B to rent a floor of his skyscraper, which he intends to use as office space. All floors are the same size, and many are used as office space. The floor that A is hoping to rent is currently empty. B tells A that it can easily fit 100 standard-sized office desks. After purchase, A finds that only 70 standard-sized desks can fit on the floor. Is A likely to be able to sue B for misrepresentation?

Yes

No

. What is the leading current authority regarding a consumer's duty to disclose material facts to an insurance company?

Lambert v Co-operative Insurance Society Ltd

Consumer Insurance (Disclosure and Representations) Act 2012, section 2

Consumer Insurance (Disclosure and Representations) Act 2012, section 4

Insurance Act 2015

. In which of the following situations is there a claim for misrepresentation?

A and B are divorcing and trying to reach a negotiated settlement. A informs B that A is never going to remarry. B does not believe this to be true and signs the contract following divorce proceedings. A is engaged at the time of the proceedings.

A boasts in a pub that the car he is selling to B can reach 60mph in 3.5 seconds. B is purchasing the car because it is a fast car but does not hear A making this statement. The car reaches 60mph in 8 seconds.

A tells B that the projected annual turnover of his business is £2.5 million. By the time B signs the contract to purchase the business, that projection has fallen in value to £1.2 million, but A does not inform B of this.

None of the options given is correct.

. A agrees to purchase a car from B. B tells A that the car has covered 60,140 miles. A did not want to purchase a car that had over 65,000 miles on the clock. A is given the opportunity to use the car and take a look around, but only looks at the size of the boot and the space in the back. The car's odometer shows that the car has travelled 67,240 miles. A would have discovered this if he had used the opportunity to look around the car properly. Does A nonetheless have a claim to rescind the contract for misrepresentation?

Yes

No

. A purchases a restaurant from B. B had told A that the restaurant had been awarded a Michelin star. After entering into the contract, A found out that the restaurant had only been shortlisted and had not actually received the accolade. A failed to make a profit from the restaurant, which she was bitterly disappointed by as she chose B's restaurant over C's restaurant, which actually had a Michelin star. A had been given the list of Michelin-star restaurants in the area by B but had failed to check the list. What damages can A recover under section 2(1)?

Losses suffered in purchasing the restaurant and attempting to run it as a business.

Losses suffered in purchasing the restaurant, attempting to run it as a business, and non-pecuniary losses for disappointment, and inconvenience.

Losses suffered in purchasing the restaurant, attempting to run it as a business, and non-pecuniary losses for disappointment, and inconvenience, as well as profits lost by not running C's business.

Losses suffered in purchasing the restaurant, attempting to run it as a business, and non-pecuniary losses for disappointment, and inconvenience, as well as profits lost by not running C's business, minus damages for contributory negligence if applicable.

. In what way do damages under the Consumer Protection from Unfair Trading Regulations 2008, as amended by the Consumer Protection (Amendment) Regulations 2014, differ from damages available under section 2(1) of the Misrepresentation Act?

Damages are limited to those which were reasonably foreseeable at the time of the prohibited practice.

No damages are available if the trader proves that the misrepresentation was due to information supplied to the trader by a third party.

There is no fiction of fraud.

All of the options given are correct.

. Which of the following clauses would not fall within the scope of section 3 of the Misrepresentation Act 1967 and would therefore not be subject to the requirement of reasonableness under section 11(1) of the Unfair Contract Terms Act 1977?

This Agreement and the Schedules and documents referred to herein constitute the entire agreement and understanding between you and us in relation to the subject matter thereof.

Any error, omission, or misdescription shall not annul the sale or be grounds on which compensation may be claimed and neither do they constitute any part of an offer of a contract.

Any representation made by either party prior to the sale of goods herein mentioned is not relied upon in the completion of the sale.

All of the options given are correct.

Chapter 16 Self-test questions

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