Misrepresentation in Property Transactions

Good morning, everyone. I am Saul Marine. I am a Principal Solicitor at Saul Marine & Co Solicitors in Mill Hill. What I wanted to talk to you this morning was about misrepresentation and how that can arise in a property transaction.

So firstly, what is a misrepresentation? A misrepresentation is an untrue statement of fact which is relied upon by the aggrieved party, which induces him to enter into the property transaction or contract and as a result, he suffers loss. So a misrepresentation must be a statement of fact, not law. Conduct can also amount to misrepresentation. The misrepresentation can either be fraudulent, which is deliberately dishonest or reckless or negligent.

A negligent misrepresentation would be where there is no grounds for the belief in the representation that was made. Fraud and recklessness can entitle a buyer to rescind the contract, which means end the contract and claim their deposit back. And the material difference between the description of the property and its actual situation entitles the buyer to damages. So what are examples of types of misrepresentation? It can be many things.

For example, if you say to the buyer, that the property is connected to utilities, connected to gas, electricity, and it turns out to be untrue, that can amount to a misrepresentation and they can prove that they have suffered a loss. You might have a statement that there has been no noise nuisance issues with a neighbour and you don’t have difficult neighbours. If that turns out to be untrue, that too is a misrepresentation and the buyer will say, Well, I have relied upon that, I bought the property and I have suffered loss as a result. So what are the top tips as to how you can avoid the situation? As conveyancing solicitors as well as litigation solicitors, we are uniquely placed because we can actually advise you what you should be saying. What is the correct answer that should be given in a property transaction that is not going to lead to a misrepresentation?

We have had the experience of dealing with misrepresentation claims and we also deal with property claims on property matters.

In a property transaction, you are given a property information form that you have to complete honestly and truthfully. Check that form carefully, discuss it with us before it’s submitted. And if you are unsure about any questions or information in the property information form, check with us first. It is vital that that form is completed correctly. If you do get a claim, contact us for early advice, because these types of claims go through a procedure. There is a protocol of an initial letter, then a protocol of a response, and it is vital to get your points of defence if you are facing a claim in the letters or if you are making a claim to put forward and put over your case. Responses need to be accurate. So we are always available to talk without obligation in relation to a claim for misrepresentation, whether you are the buyer or the seller and you can contact us on our telephone number on the website for early and important advice.

Thank you very much.