How to use the Misrepresentation Act 1967

Misrepresentation Act 1967
Been mis-sold a contract? Use the Misrepresentation Act 1967

This is a much underused Law. (It doesn’t cover Scotland but Scottish Law is broadly similar). But as well as reading this post you should also see the more updated law Consumer Protection from Unfair Trading Regulations 2008 (updated 2014). It protects the consumer from being mis-led or mis-sold goods or services. If you enter into a contract and purchase an item or service because you believed a statement (not an opinion) regarding it, then you can end the contract, get a refund and claim compensation. There are three types of Misrepresentation where a false statement was made:

Fraudulently – statement made by someone that they know is untrue, believe it is untrue or is made recklessly
Negligently – statement made carelessly or without reasonable grounds for believing its truth.
Innocently – statement made without fault

Fraudulent/negligent statements

If you entered a contract as a result of a fraudulent or negligent statement you can cancel the contract. You can also claim damages in most cases. These claims are on the basis of negligence or fraud. The person who made the misrepresentation has to disprove the negligence. So for example, if you book a holiday on the basis that it is a holiday where children are not allowed and find that when you arrive the place is overrun with children then this is a clear breach. I used the Act  as part of a complaint for a story regarding misrepresenting a holiday booking.

Innocent statements

This is considered to be when either party enters into a contract having reasonable grounds for believing that his or her false statement was true. The contract is usually just cancelled in this situation.

Under Section 2(2) Misrepresentation Act 1967 the court has the discretion to award damages instead of allowing you to end the contract if it deems it appropriate. It cannot award both, judged on nature of misrepresentation and losses suffered.

Limitations

If you chose to continue with the contract although you were aware of the misrepresentation you will not be able to end the contract or claim damages. For example if you booked a holiday knowing that the hotel described in the brochure was family friendly but you knew this was a mis-print due to other factors in the brochure or had had it pointed out to you and you proceeded with the booking you will have, in law, “affirmed” the contract.

You need to act quickly after discovering the misrepresentation. For example, if you have been sold a mobile ‘phone contract on the basis of receiving 500 free texts a month and you have continued to use the ‘phone for a few months before complaining about being charged for them a court may say that you should have complained the first month in which you were charged. All cases are different though and are assessed as such.

I quoted this Act in a case against NatWest and Sunmaster. Which category of statement do you think they fell into? Have you used this Act? Will you now you know about it?!

More recent Acts

People think of misrepresentation and think ah there’s a law about that. Yup this one. However, you now have more cover with more recent laws, so you should also see Consumer Protection from Unfair Trading Regulations 2008 (updated 2014).

You are also covered by the Consumer Rights Act 2015 if the item does not match the description, is not fit for purpose or of satisfactory quality.

 

More details on how to complain in the book, information, advice, laws and template letters How to Complain: The Essential Consumer Guide to Getting Refunds, Redress and Results!