03 December, 2021
In the recent case of Glossop Cartons and Print Ltd v Contact (Print and Packaging) Ltd - which went to the Court of Appeal - it was held that a buyer seeking damages from a seller for fraudulent misrepresentation is still entitled to compensation despite agreeing a 'bad bargain'.
The case highlights the importance of sellers providing honest answers to solicitors' enquiries and confirms the relief available for parties who have been victims of fraudulent misrepresentation.
In this case, the buyer sought to purchase three commercial units and, in their replies to enquiries, the sellers:
The buyers successfully claimed that they had been induced to enter into the purchase contracts by the sellers' fraudulent misrepresentations about the property. The Court of Appeal held that even though the buyers were aware they were acquiring a business suffering financial loss, and had made numerous financial misjudgements, they were still entitled to recover their direct loss - being the difference between the price paid for the asserts purchased and their market value.
The case serves as an important reminder for sellers to ensure that they are open and honest in their replies to enquiries, as a misleading or untruthful response could prove to be expensive.
For more information contact Helen Marsh in our Commercial Property department via email or phone on 0333 207 4236. Alternatively send any question through to Forbes Solicitors via our online Contact Form.
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