Legal Advice on Misrepresentation and Negligence Cases

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Business Law

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EXECUTIVE SUMMARY
The purpose of this report is to provide legal advice in the two cases after identifying
and assessing relevant laws and cases. The first case deals with the issue of
misrepresentation and the second case deals with negligence. The advice is given to
Angela that she can file a lawsuit against Jessica for making a false statement during the
negotiation stage of the contract based on which she signed the contract and suffered
loss. She can claim remedies as it was a fraudulent misrepresentation based on which
the contract can be terminated, and Angela can claim damages. The advice is given in
the second case that all elements of negligence are present in this case based on which
Acme Cola Company Limited is liable. Smiths can file a suit against the company and
demand compensation for the losses suffered by them.

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TABLE OF CONTENTS
Introduction.......................................................................................................................................................... 3
Case 1....................................................................................................................................................................... 3
Legal Advice for Angela............................................................................................................................... 4
Case 2....................................................................................................................................................................... 5
Legal Advice for Smiths............................................................................................................................... 6
Conclusion.............................................................................................................................................................. 7
References.............................................................................................................................................................. 8

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INTRODUCTION
The importance of contracts has grown substantially as more and more people create
contractual relationships to perform personal or professional duties. It binds two or
more parties into its terms, and each party can bind each other to discharge their legal
obligations. The presence of misrepresentation in a contract resulted in making the
contract voidable based on which the party has the right to rescind the contract or bind
it upon himself and other parties. It occurred when a party make a false statement
during the negotiation period of a contract for attracting another party into signing the
contract. On the other hand, negligence is a key factor based on which parties which
suffered loss can claim for damages. A party can file a suit for negligence if a duty of care
is not maintained by a party which resulted in causing the damages. Two cases will be
analysed in this report after analysing relevant laws and cases. Appropriate legal advice
will be given in each case to the parties based on the evaluation of the relevant laws and
cases.
CASE 1
In this particular case, the issue is raised by Angela regarding the false representation
made by Jessica. In order to advise Angela whether a suit for misrepresentation can be
formed, it is necessary to understand relevant laws and judgement of relevant cases. A
party can be held liable for misrepresentation if it made a false statement with a
purpose of inducing another party into signing a contract. The party which showed
reliance on the untrue statement and create a legal relationship has the right to file a
suit for damages. The contract which is constructed between two or more parties is not
considered as void; instead, it is voidable (Knapp, Crystal and Prince, 2016). It means
that the innocent party which contracted the contract has the right to make the contract
void or valid. The party can accept the term of the contract and bind itself into
contractual obligations or terminate the contractual relationship and claim for damages
from the party. There are certain elements which are required to be present in order to
generate a claim for misrepresentation. Primarily, it is necessary that the parties make a
false statement to a contract in order to construct a case of misrepresentation.