The process of entering into business contracts is vulnerable to a number of legal concerns, including fraud and misrepresentation. At Hendershot, Cannon, Martin & Hisey, P.C., our Houston-based practice heavily focuses on protecting businesses from fraud, breach of fiduciary duty, and misrepresentation, remedying consequences suffered as a result, as well as defending against accusations of fraud or misrepresentation.
Misrepresentation occurs when false information is provided by a defendant and relied upon by a plaintiff, and fraud is a form of misrepresentation that is active and deliberate. Breach of fiduciary duty involves the relationship between a trusted agent (the fiduciary) and the person or entity they owe an obligation to.
For example, an accountant is obligated to work in the interests of his or her clients, an employee is obligated to work in the interest of his or her employer, and a corporation in the interest of its investors.
What is the difference between fraud and misrepresentation?
To be proven, each case requires a material fact and reliance. A material fact is information that can be proven by past or present data, which does not include beliefs, opinions, speculations, or predictions.
Reliance is the idea that the plaintiff would not have entered into the agreement if it were not for the misrepresented facts, or that the plaintiff relied on the fiduciary for financial success.
When a party enters into an agreement as a result of material facts that were falsely represented, the latter may be liable for any and all damages suffered by the former. Additionally, in some cases, fraudulent activity may be subject to criminal charges. Whether your business was the victim of fraud, or you have been falsely accused of fraud, this is a matter that should be handled by an aggressive and experienced business litigator.
It is important to note that a defendant can also be guilty of silent fraud, which involves the deliberate failure to disclose a substantial material fact. In these cases, it must be proven that the undisclosed material fact created a false impression which was relied upon by the plaintiff and ultimately resulted in damages.
In addition to fraudulent misrepresentation, innocent and negligent misrepresentation can also be established. Both differ from fraud in that the defendant believed the material facts to be true when they were represented. These forms of misrepresentation lack a deliberate intent to deceive the plaintiff and are handled differently.
Through our diligent representation of businesses, Hendershot, Cannon, Martin & Hisey has established a representation for zealous advocacy and excellence. We dedicate our resources to the thorough research, analysis, and development of every case we handle—a practice that has resulted in a proven record of success.
Learn why we are the trusted source for business law counsel throughout Texas and beyond—call our firm at (713) 909-7323 or fill out a brief online form.