Section 21 Common Law Fraud

• Library: Home Purchases, Ownership, and Financing 2011

Additionally, suits against home remodelers may allege common law fraud or misrepresentation. To make out a case of misrepresentation or fraud, the plaintiff must prove:

1) a false material representation;

2) the speaker’s knowledge of the falsity of the misrepresentation or ignorance of the truth;

3) the speaker’s intent that the hearer acted upon the misrepresentation in a manner reasonably contemplated;

4) the hearer’s ignorance of the falsity of the misrepresentation;

5) the hearer’s reliance on its truth;

6) the hearer’s right to rely thereon; and

7) the hearer’s consequent and proximately caused damages.

CADCO, Inc. v. Fleetwood Enters.,Inc., 220 S.W.3d 426, 436
(Mo. App. E.D. 2007) (quoting Roth v. Equitable Life Assurance Soc’y of the United States,210 S.W.3d 253, 258 (Mo. App. E.D. 2006)).
If a plaintiff fails to establish any one of these elements, the claim will fail. Id.

An essential and often-contested element of both fraud and misrepresentation is reliance on the representation and damage
as a result of that reliance. McClain v. Papka, 108 S.W.3d 48, 52
(Mo. App. E.D. 2003) (citing Sanders v. Ins. Co. of N. Am., 42 S.W.3d 1, 9 (Mo. App. W.D. 2000)). Failure to prove reliance “is fatal to a claim dependent thereon.” Id.(citing Reis v. Peabody Coal Co.,
997 S.W.2d 49, 62 (Mo. App. E.D. 1999)). “The right to rely on a representation is generally a question of fact.” Id. at 52. “The concept of fraud liability based upon nondisclosure couches reliance in terms of the availability of the information to the plaintiff and...