There are four possible sources of an award of damages for misrepresentation. To establish which may be available it is necessary to distinguish between fraudulent, negligent and innocent misrepresentations. A victim of a fraudulent misrepresentation may recover damages at common law for the tort of deceit. A victim of a negligent misrepresentation may recover damages at common law for the tort of negligence. In both these situations the victim may have an alternative claim for damages under s 2(1) of the Misrepresentation Act 1967.
The victim of an innocent misrepresentation has no right to damages, either at common law or by statute. However, s 2(2) of the Misrepresentation Act 1967 confers on the court a discretion to award damages in place of rescission where the misrepresentation has been made innocently (or negligently).
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