MISREPRESENTATION. An untrue rep resentation, by words or by conduct. which in duces another to act to his injury. SVben deliber ately or recklessly made 1)3- one party to a busi ness transaction concerning a matter of fact and relied on by the other party to his damage, it amounts to fraud (q.v.). and has been dealt with fully under that heading and the heading of (q.v.). A 611.0 if made by an honest mistake, never subjects the maker to au action in tort. Whether it will afford the party to whom it is made a ground for relief of any kind depends upon the circumstances of the case.
As a rule, an innocent misrepresentation will not affect the validity of a contract in connec tion with which it is made, unless it was the very basis of the contract or one of its material terms.
In certain classes of contracts, notably those of marine and fire insurance (q.v.), any misrep resentation or concealment of a material fact, However innocent, renders them void. This is due
largely to the fact that such contracts have come into English law from the law merchant, and that early niereantile usage put an absolute legal duty on the insurer to state correctly all facts relating to the thing insured, which would or dinarily affect the insurer's decision in taking the risk. Courts of equity deal somewhat differently with hunwent misrepresentation from courts of common law. They will generally refuse a decree for specific performance in favor of one whose claim rests upon a misrepresentation, although it is an honest one: and in some cases they grant a rescission of a contract induced by such state ments when a court of law would not. Consult: Anson. Principles of the Law of Contract (Ox ford, 1900) : Burdick. The Essentials of Business Law (New York. 1902) ; Kerr, A Treatise on the Lou' of Fraud and Mistake (London, 1902).