Law Q&A

Kamau advertised the sale of his farm. He was approached by Keter who wanted to buy the farm. In the course of negotiating the price, Keter asked Kamau how many sheep could be reared on the farm and Kamau replied, “I have not used the farm for sheep rearing but I think it could support 2000 sheep.”

Keter bought the farm and immediately purchased 2000 sheep to rear on it. However, the firm is unable to accommodate the 2000 sheep and Keter is aggrieved and intends to sue Kamau for misrepresentation.

Advise Kamau.

Suggested Answer:

This problem is based on statements made by parties in the course of negotiations leading to a contract. 

In this case Kamau made a statement which influenced Keter to purchase the firm, but the statement turns out to be untrue and Keter feels aggrieved and has threated to sue Kamau for misrepresentation.  

 It is apparent that Kamau‟s statement is not an assertion of fact. It is an opinion for which Kamau cannot be sued.

opinion which does not amount to misrepresentation.

 

My advice is based on the decision in Edindgton V. Fitzmaurice.

Where;

Defendants sought funding for a property and Plaintiff advanced Defendants 1500 pounds. Defendants made several misstatements to Plaintiff. Plaintiff sued Defendant for deceit.

The rule states that In order to sustain an action for deceit, Plaintiff must first prove that there was a statement as to facts where was false; and secondly, that it was false to the knowledge of Defendants, or that they made it not caring whether it was true or false. Lastly, when you have proved that the statement was false, you must further show that the statement was wither the sole cause of Plaintiff’s act, or materially contributed to his so acting.

Plaintiff advanced 1500 pounds for debentures of a society of which Defendants were the directors and officers. To raise the funds, Defendants circulated a prospectus that announced that they had acquired a valuable property subject to a half yearly payment of 500 pounds in redemption of a mortgage of 21,500 pounds. They also stated that they would use to the money to complete alterations and additions to the buildings and purchase their own horses and vans and to further develop the arrangements for the direct supply of cheap fish. Those statements were impeached because:

i)        they were framed to lead a person to believe that the debentures would be a charge on the property of the company;

ii)      it failed to mention a second mortgage on the property;

iii)    it failed to state that the entire 21,500 pound mortgage was due in full on April 5, 1884; and,

iv)    That the real object of the debentures was to pay off present company liabilities and that the company could not complete its planned purchases of equipment as advertised. The trial court found for Plaintiffs. Defendants