{"id":220875,"date":"2023-02-17T12:04:50","date_gmt":"2023-02-16T23:04:50","guid":{"rendered":"https:\/\/legalvision.co.nz\/?p=220875"},"modified":"2023-03-09T19:14:41","modified_gmt":"2023-03-09T06:14:41","slug":"misrepresentation-contract","status":"publish","type":"post","link":"https:\/\/legalvision.co.nz\/commercial-contracts\/misrepresentation-contract\/","title":{"rendered":"Consequences of a Misrepresentation in a Contract in NZ"},"content":{"rendered":"\n

Contracts are used every day to give legal standing to agreements. The most popular form of contract is a written contract. These legally binding documents represent a relationship or transaction between two or more parties. All parties to the contract must follow the terms of the contract. However, a common mistake in the contract can be a misrepresentation. This article will explain what misrepresentation is and its consequences. <\/p>\n\n\n\n

Terms of a Binding Contract<\/h2>\n\n\n\n

You must satisfy several elements before a contract is legally binding. All of these elements must be present, and there can be no uncertainty about whether an element is included.<\/p>\n\n\n\n

Term<\/strong><\/td>Explanation <\/strong><\/td><\/tr>
Offer<\/td>One party must convey an offer to the other party that they wish to contract on certain terms. They must communicate this so that the other party can receive the offer.<\/td><\/tr>
Acceptance<\/td>The party receiving the offer must accept it as the contract prescribes. Any deviation in the acceptance method may invalidate the contract. The acceptance must also be before the expiry date of the offer. An exception to this is the postal acceptance rule. This states that the acceptance is unequivocal as long as the receiving party posts acceptance before the expiry date. <\/td><\/tr>
Consideration<\/td>Another element that must be satisfied is consideration. Consideration means that both parties must receive something due to the contract. Consideration can either be a benefit or a detriment. Consideration must also be sufficient, meaning it must match or sufficiently match the value of the contract. <\/td><\/tr>
Intention, <\/td>Both parties must intend for the contract to be binding. If one party does not believe the agreement is binding, then the contract will not be considered binding.<\/td><\/tr>
Certainty<\/td>The terms of the contract must be certain. This means that there cannot be any ambiguity in the contract. If a term is ambiguous, the courts can either invalidate the whole contract or invalidate that particular clause.<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n

What is Misrepresentation?<\/h2>\n\n\n\n

Misrepresentation is when one party to a contract deliberately misleads<\/a> or makes a statement that they know to be untrue about the contract matter. The misrepresentation must be about a past or existing fact. For example, a retailer may state that a good is of a certain quality when they know this is false.<\/p>\n\n\n\n

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You must avoid misrepresentation as it has very serious consequences.<\/p>\n<\/div>\n\n\n\n

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Commercial Contracts Checklist<\/div>\n
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