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Team no: 5

Members: Madhana Gopal Natarajan, Pradeep Raghavendhra, Irfan

Mohammed, Kaveramma.BG, Kruthi Ganesh.

Facts of the case:

Ashok wanted to buy a house. Subhash was asked to inspect and value the property. Subhash valued the house at Rs 10 lakhs, without noticing the

defective plumbing system.

The real value estimated to be Rs 8 lakhs. Ashok buys the house for Rs 10 lakhs, spends four Rs 2 lakhs for

repairing the plumbing system and Rs 2 lakhs for other repairs.

Ashok files a suit against Subhash, claims damages for Rs 4 lakhs.Analysis:

In this case Subhash is an engineer who inspected the house and failed to

notice the defective plumbing system in the house during the survey to

value the house. Without the intent to deceive, due to his negligence thehouse which had to be valued at 8lakhs was valued for 10lakhs. There

was no intention to deceive Ashok, Ashok followed Subhashs advice to

buy the house with his own interest and purchased the house for 10 lakhs

and spent an extra Rs 4 lakhs on repairs. Ashok then files a law suit on

Subhash claiming Rs 4 lakhs on damages for the false statement

provided by him.

Interpretation:

This is a case of an innocent misrepresentation. Here in this case Ashok

asked Subhash to value a property; it is valued according to Subhashs

knowledge and experience in the field of valuation of the property. The

valuation done by Subhash, though may not be true, is honestly believed

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to be true by Subhash, here Ashok may or may not consider the

statement given by Subhash at the time of purchase of the property.

False representation made by Subhash, which is not true, though

believes it to be true. Thus in this case Subhash makes a statementwithout the knowledge of the statement being untrue and with an honest

belief in its truth.

Conclusion:

As per the above interpretation of the case, Subhash did not willfully

provide false representation/statement, nor did he provide the statement

with the intention to deceive Ashok to induce him to enter in to the

contract. In this case Subhash believes the statement to be true, though it

is not and therefore Subhash is not entitled to damages claimed by

Ashok.

Justification:

As per the Indian Contract Act 1872 defines Misrepresentation (Section

18):

the positive assertion, in a manner not warranted by theinformation of the person making it, of that which is not true,

though he believes it to be true;

(2) any breach of duty which, without an intent to deceive, gains anadvantage to the person committing it, or anyone claiming under

him; by misleading another to his prejudice, or to the prejudice of

any one claiming under him;

(3) Causing, however innocently, a party to an agreement, to makea mistake as to the substance of the thing which is subject of the

agreement.

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If the party to whom the innocent misrepresentation is made had means

of discovering the truth with ordinary diligence, the contract in not

voidable section (19).

In the case of an innocent misrepresentation, the aggrieved party cannotsue for damages, but can only avoid the agreement.