Dimmock v Hallett
Court of Appeal
Citations: (1866-67) LR 2 Ch App 21.
The claimant was a mortgagee who possessed of a mortgaged farm. This farm was put up for auction by the court. The particulars of sale greatly overestimated the amount of rent which could be obtained from the land. The defendant bid on the land, and their bids were driven up by £4000 by the claimant’s counter-bids. The defendant later argued that the contract should be discharged for misrepresentation.
- Was the contract capable of being rescinded for misrepresentation?
The Court of appeal held in favour of the defendant. The fact that the claimant had bid on the land was not grounds to avoid the sale. This was because the auctioneer had informed attendees that interested parties were entitled to bid. It was not relevant that the defendant had not heard this.
By contrast, the misrepresentation as to the possible rent obtainable from the land was a substantial misrepresentation which induced the defendant to enter the contract. The contract could be avoided on these grounds.
This Case is Authority For…
A contract may be avoided where one party to the contract makes a false statement of fact which induces the other party to enter into the contract.