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Facts[]

Land and House contracted with Smith to buy the title of the Marine Hotel at Walton-on-the-Naze. Smith had advertised that it was let to Fleck, "a most desirable tenant". Land and House agreed to buy the hotel however Fleck, who had been overdue with rent, went bankrupt just before transfer of title. Land and House refused to complete the transaction, defending Smith's specific performance on the basis that the description of Fleck's virtues was grounds for misrepresentation.

Issue[]

  1. Was the statement a mere opinion or a representation of fact?

Decision[]

Appeal dismissed.

Reasons[]

Bowen held that when facts are equally known to both sides, then statements are generally opinions, however when facts are not equally known, then a statement of opinion by one who knows the facts best is often a statement of material fact as they are implying that his opinion has justification. In this case, with Fleck being behind in his rent, the statement of him being a "desirable tenant" was not a true statement and thus Land and House were entitled to not complete the transaction due to misrepresentation.

Ratio[]

  • A statement of opinion, from a knowledgeable party to one who is not, is a representation.  
  • Innocent misrepresentation allows rescission.
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