Disadvantages Of Misrepresentation Act
Other that damages and rescission, there’s also excluding or limiting liability for misrepresentations. Section 19(1) of the Contracts Act that provides that agreements caused by coercion, fraud and misrepresentation are voidable contracts. Thus, in the situations provided, the contract is not voidable if the innocent party was able to ascertain the truth of the matter by exercising ordinary diligence. There have been uncertainties whether the word "fraudulent" applies only to silence thus fraud by silence or it applies to misrepresentation as well thus to fraudulent misrepresentation.
A contract is rescinded for misrepresentation because it would not have been entered into but for the misrepresentation. This justifies only the cutting away
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So, it can be sum up that Australia’s misleading representation allowed that the faulty factual statement can be based on a promise of future behavior. In Malaysia’s and India’s position, the Court has to rule whether or not the assent of the person is given with uneasiness or misunderstanding of fact; the court should also be persuaded with the proof that the person carrying out the act has the knowledge of the fact or should have reason to think that but for the fear or wrongful impression, the consent would not have been …show more content…
Basically, it happens when the party making the fake promise aims to convince the victim to enter into a legally-bound contract. The case of Jong Chuk v Chong Tung Sang & 5 Ors applies subsection (c) of section 17. In this case, the sixth defendant is the third party to the agreement between plaintiff and the first five defendants. The agreement was to develop a land owned by defendants and it was agreed that the representatives or the assigned person were bound to this agreement. When the land was sold to the third party (Bacom Enterprises Sdn Bhd), it was found out that the third party did not plan to carry out the agreement although they are bound to it. Instead, they had all along had another plan to develop the land. The court then held that the third party was guilty under fraud within the meaning of section 17(c) and
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