So far, we have considered cases where the defendant has said or done something. But what about the case where he says or does nothing? As a general rule, one party is not obliged to volunteer information which the other party might consider relevant: ‘the failure to disclose a material fact which might affect the mind of a prudent contractor does not give the right to avoid the contract’ (Bell v Lever Bros Ltd [1932] AC 161, 227 (Lord Atkin)). In other words, by keeping silent (or still) the defendant escapes liability. A good example is:
C took a tenancy of a house owned by D. C alleged that shortly after moving into the house, a great part of it fell down, endangering C and his family and forcing them to move out. C claimed damages in deceit on the ground that as D knew before granting the tenancy that C wanted the house for immediate occupation and that the house was in ruinous state and unfit for occupation, D ought to have warned C of the condition of the house. The claim failed. There was no allegation that D had warranted the condition of the property, nor was there any misrepresentation.
‘The declaration struck me, at first sight, as a perfectly bad one; and it does not improve upon acquaintance.’ Maule J at 601.
But, exceptionally, the defendant will be under a positive duty to make a disclosure, and will be liable if he fails to do so. See, for example, the Marine Insurance Act 1906, s 18(1).
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