13.4.4 Actor's Knowledge of Falsity or Ignorance of the Truth (“Scienter”).

• Jurisdiction: Arizona

13.4.4 Actor’s Knowledge of Falsity or Ignorance of the Truth (“Scienter”). The fourth element addresses the actor’s state of mind. “Fraud is usually defined as malfeasance, a positive act resulting from a willful intent to deceive.”⁵⁰ It is the actor’s willful intent which makes the representation fraudulent. As such, Arizona courts have stated, “[t]o maintain a claim for fraudulent misrepresentation, the claimant must demonstrate the speaker’s knowledge of the falsity of the statement”⁵¹ at the time it was made.⁵² This is the general rule in Arizona. However, it is also true that “if a person take[s] [it] upon himself to state, as true, that of which he is wholly ignorant, he will, if it be false, incur the same legal responsibility as if he had made the statement with knowledge of its falsity.”⁵³ In such a case, “[t]he fraud consist[s] in representing that he knows that of which he in fact is consciously ignorant.”⁵⁴ In both scenarios, the actor’s state of mind is key in establishing the fraudulent nature of his representation.

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