‘There is a smile of love,
And there is a smile of deceit,
And there is a smile of smiles
In which these two smiles meet’ – William Blake
You can say, and do things which cause others to react in certain ways.
What and how you deliver a statement, and what and how the person reading or hearing that statement reacts, when compared with truth and reality, defines the wrongdoing in Law, and the remedy.
Different scenarios cause different consequences, with different remedies. In this blog post, I explore some of the obvious scenarios which do not result from contractual relationships
A. Negligent Misstatement:
In order to establish negligent misstatement, there are 4 characteristics which define a special relationship between the parties. These were set out in Caparo Industries plc v Dickman
These 4 characteristics are better known as the assumption of responsibility test:
1. The adviser knew or by inference knew that the advice was required for a purpose;
2. The adviser knew that the advice would be communicated to the advisee;
3. It was known that the advice would be acted upon by the advisee without independent inquiry; and
4. It was acted upon by the advisee to his detriment.
4 different characteristics as set out in Bradford Third Equitable Benefit Building Society v Borders
1. A representation made by facts or conduct. However, mere silence, however morally wrong, will not support an action of deceit.
2. A representation must be made with knowledge that it is false. It must be wilfully file, or at least made in the absence of any genuine belief that it is true.
3. It must be made with the intention that it must be acted upon, in the manner which resulted in damage to him…If, however, fraud can be established, it is immaterial that there was no intention to cheat or injure the person to whom the false statement was made…
4. It must be proved that someone has acted upon the false statement and has sustained damage by so doing…
Although in civil cases the standard of proof is the balance of probabilities, the degree of probability will vary according to the seriousness of the allegation to be proved.
If deceit is established, the caps of remoteness usually found in negligent misstatement, is far wider. The Defendant will be liable for all losses flowing directly from the Tort, whether they were foreseeable or not.
C. Injurious/Malicious Falsehood:
This tort was considered in Ratcliffe v Evans:
‘…an action will lie for written or oral falsehoods, not actionable per se nor even defamatory, where they are maliciously published, where they are calculated in the ordinary course of things to produce, and where they do produce, actual damage, is established law. Such an action is not one of libel or slander, but an action on the case for damage wilfully and intentionally done without just occasion or excuse, analogous to an action for slander or title. To support it, actual damage must be shewn, for it is an action which only lies in respect of such damage as has actually occurred’.
The Tort is committed where the Defendant:
1. Made a false statement to a 3rd party;
2. with malice;
3. as a result of which the Claimant suffered damage.
So be careful what you say and what you do, because what is said or done, may result in qualifying under one of the above torts, which will likely lead to damages and costs being paid.
Professor Rosen is a Solicitor-Advocate, Partner and head of Litigation at Darlingtons Solicitors
  UKHL 2
 [ 2 All ER, 211
  2 QB 524
Haven't found what you need yet?
Why not search the whole site?