What to do about misrepresentation in a contract?
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What to do about misrepresentation in a contract?
I entered a contract with a service company. The sales people said one thing, their web site says the same as their sales. However, after the training period when we were just about to start using, I realized the software could not fulfill some of the items. I asked them if they can adjust they said no they can’t. I asked for them to cancel. Since I never used the software, I asked if they can only charge me for the minimum 3 months that I was obliged to pay. They never responded. The threatened debt collection. After months of email them with no reply, a debt collector calls.
Asked on June 19, 2012 under Business Law, Florida
Answers:
SJZ, Member, New York Bar / FreeAdvice Contributing Attorney
Answered 12 years ago | Contributor
A material, or important, misrepresentation, knowingly or intentionally made to induce you to enter into a contract or buy something is fraud; fraud can provide grounds to rescind, or void, the contract. If someone tries to enforce a contract against you which was founded on fraud, you could raise fraud as an affirmative defense to liability.
That's the law; however, given that no legal action is ever certain (e.g. if they sue you, and you raise fraud as a defense, can you prove the misrepresentations? and are they sufficiently material or important, or just minor inconveniences, which would not provide grounds for rescission) and defending a lawsuit has its own costs, it may be better to try to settle, or even pay the full amount, rather than contest the charge--it depends on how much is at stake.
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