{"id":196376,"date":"2026-03-19T05:20:31","date_gmt":"2026-03-19T05:20:31","guid":{"rendered":"https:\/\/legalvision.co.uk\/?p=196376"},"modified":"2026-03-25T01:19:43","modified_gmt":"2026-03-25T01:19:43","slug":"misrepresentation-act-1967-guide-small-businesses","status":"publish","type":"post","link":"https:\/\/legalvision.co.uk\/commercial-contracts\/misrepresentation-act-1967-guide-small-businesses\/","title":{"rendered":"What is Misrepresentation? Guide for Small Businesses"},"content":{"rendered":"\n<p>If someone made false statements to your business before you signed a contract, you may have significant legal rights under the <em>Misrepresentation Act 1967<\/em>. Understanding these rights can help you protect your business, respond effectively when things go wrong and avoid liability for your own pre-contractual statements. This article explores key rights and remedies available under the law, proactive action steps to help protect your small business from contractual risk and the importance of seeking specialist legal advice in respect of misrepresentation issues<\/p>\n\n\n    <div class=\"my-7 lg:my-10 border-y-2 border-gray-100 py-7 lg:py-10 flex flex-col sm:flex-row items-start gap-10\">\n                    <img decoding=\"async\" class=\"w-52 mx-auto my-0! rounded\" src=\"https:\/\/img.legalvision.com.au\/wp-content\/uploads\/sites\/4\/2023\/05\/03024102\/LegalVision_UK-Supplier-Contracts-Checklist.jpg\" alt=\"Front page of publication\"\n                 loading=\"lazy\" width=\"208\" height=\"298\">\n                <section>\n            <div class=\"text-2xl font-bold\">Supplier Contracts Checklist<\/div>\n            <div class=\"body-text\">\n                <p>Download this free Supplier Contracts Checklist to ensure your contracts will meet your business\u2019 needs.<\/p>\n            <\/div>\n            \n\n<a href=\"https:\/\/go.legalvision.co.uk\/supplier-contracts-checklist.html\" class=\" block px-5 py-3.5 max-w-fit bg-orange button__hover transition rounded text-white font-bold text-lg no-underline uppercase leading-tight text-center\" target=\"\" rel=\"\">Download Now<\/a>        <\/section>\n    <\/div>\n\n\n\n\n<h2 class=\"wp-block-heading\">Understanding Misrepresentation in Contract Negotiations<\/h2>\n\n\n\n<p>If someone <a href=\"https:\/\/legalvision.co.uk\/disputes-litigation\/what-is-misrepresentation\/\">misrepresents a contract<\/a> and make a false statement that leads you to enter it, it is called misrepresentation. You must know about the statement, rely on it and let it influence your decision, even if it is not the only reason you signed.<\/p>\n\n\n\n<p>Not all statements made during negotiations have legal effect. The law distinguishes between three types:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>only sales talk has no legal effect as these are vague claims that no reasonable person would treat as fact;<\/li>\n\n\n\n<li>contractual terms form part of the contract. If they are wrong, you may claim for breach of contract; and<\/li>\n\n\n\n<li>representations are statements that sit outside the contract but influence your decision. If they are false and you relied on them, you may claim for misrepresentation.<\/li>\n<\/ul>\n\n\n\n<div  class=\"box box--icon box--idea\">\n    <p>A representation can be made in writing, verbally or through conduct. Silence is not usually misrepresentation, but it can be if someone tells a half-truth or if a statement becomes false before you sign. To bring a claim, you need to show that relying on the false statement caused you <a href=\"https:\/\/legalvision.co.uk\/franchising\/franchisors-avoid-misrepresentation\/\">financial loss<\/a>.<\/p>\n<\/div>\n\n\n\n<h2 class=\"wp-block-heading\">Types of Misrepresentation and the Remedies Available<\/h2>\n\n\n\n<p>The law recognises three types of misrepresentation and it <a href=\"https:\/\/legalvision.co.uk\/franchising\/legal-remedies-franchisee-misrepresentation\/\">determines the remedies<\/a> available to you. Hence, you should get the classification right.<\/p>\n\n\n\n<div class=\"wp-block-group has-background-background-color has-background is-layout-constrained wp-container-core-group-is-layout-c47b1c0c wp-block-group-is-layout-constrained\">\n<figure class=\"wp-block-table is-style-stripes\" style=\"font-size:18px\"><table class=\"has-fixed-layout\"><tbody><tr><td><strong>Fraudulent Misrepresentation<\/strong><\/td><td><strong>Negligent Misrepresentation<\/strong><\/td><td><strong>Innocent Misrepresentation<\/strong><\/td><\/tr><tr><td>When a party makes a false statement knowing it is untrue, or without caring whether it is true or false. This is the most serious type of misrepresentation and allows you to set aside the contract and claim damages.<\/td><td>When a party makes a false statement without reasonable grounds for believing it is true. Once you show the statement is false, the other party must prove they had reasonable grounds to believe it.<\/td><td>When a party makes a false statement but had reasonable grounds to believe it was true. The court may allow you to set aside the contract or award damages instead, depending on what is fair in the circumstances.<\/td><\/tr><\/tbody><\/table><\/figure>\n<\/div>\n\n\n\n<h3 class=\"wp-block-heading\">Exclusion Clauses and Limitations on Liability<\/h3>\n\n\n\n<p>Many commercial contracts include clauses that limit or exclude liability for statements made before the contract is signed. These are often called entire agreement or non-reliance clauses. In practice, this can restrict your ability to rely on statements made during negotiations, even if they are false.<\/p>\n\n\n\n<div  class=\"box box--icon box--idea\">\n    <p>Whether these clauses are enforceable depends on how they are drafted and the circumstances. UK courts apply reasonableness tests and not all clauses will work as intended. Before you sign, you should get legal advice to understand how these clauses affect your rights.<\/p>\n<\/div>\n\n\n\n\n<a href=\"#content-next\"\n   class=\"block p-4 mt-10 text-xl font-bold text-center text-white no-underline bg-gray-800 rounded-t-xl\">\n    Continue reading this article below the form\n    <i class=\"text-xl fa-regular fa-arrow-down\"><\/i>\n<\/a>\n<div class=\"px-6 pt-10 pb-12 mb-10 text-center bg-gray-100 rounded-b-xl sm:px-12 test\">\n    <div class=\"mb-8 text-2xl font-bold text-orange\">\n        Need legal advice?\n        <br>\n        <span class=\"text-lg not-prose\">\n                            Call <a href=\"tel:+448081968584\" class=\"not-prose\">0808 196 8584<\/a> for urgent assistance.\n                <br>\n                Otherwise, complete this form, and we will contact you within one business day.\n                    <\/span>\n    <\/div>\n\n    \n\n<div class=\"not-prose flex justify-center text-left gform_input_bg_white    \">\n    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You should take <a href=\"https:\/\/legalvision.co.uk\/corporations\/avoid-seller-misrepresentation\/\">preventive steps<\/a> before and during negotiations.You should:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>keep a written record of all statements made during supplier negotiations, including verbal statements confirmed by email;<\/li>\n\n\n\n<li>request written proof of any performance, financial or compliance claims before you rely on them;<\/li>\n\n\n\n<li>seek written confirmation of anything that materially influences your decision to enter the contract;<\/li>\n\n\n\n<li>challenge any information presented in a misleading or incomplete way, and ask for full disclosure;<\/li>\n\n\n\n<li>review exclusion clauses carefully and ask a commercial contracts lawyer to explain the implications before you sign; and<\/li>\n\n\n\n<li>If you suspect misrepresentation after signing, act immediately. Delays or continuing to perform the contract may be treated as acceptance and limit your available remedies.<\/li>\n<\/ul>\n\n\n\n<div  class=\"box box--icon box--info\">\n    <p>You also have obligations of your own. Any statements your business makes during negotiations should be accurate and verifiable. If a customer relies on a false statement from you when deciding to sign, you may face a misrepresentation claim.<\/p>\n<\/div>\n\n\n\n<h2 class=\"wp-block-heading\">Key Takeaways<\/h2>\n\n\n\n<p>Misrepresentation occurs when a false statement of fact or law induces you to enter a contract. There are three types of misrepresentation such as fraudulent, negligent and innocent. The type of misrepresentation determines the remedies available to you. Exclusion clauses in supplier contracts can limit your rights, however their enforceability depends on the specific wording and circumstances. Prevention is more cost-effective than litigation. If you discover a false statement after signing, you should act promptly. If you delay it can cost you your available remedies.<\/p>\n\n\n\n<p>LegalVision provides ongoing legal support for businesses through our fixed-fee legal membership. Our experienced <a href=\"https:\/\/legalvision.co.uk\/contract-lawyers-lp\/\">contract lawyers<\/a> help businesses manage contracts, employment law, disputes, intellectual property, and more, with unlimited access to specialist lawyers for a fixed monthly fee. To learn more about LegalVision\u2019s legal membership, call <a href=\"tel:+448081968584\" class=\"AVANSERnumber dynamic-number\">0808 196 8584<\/a> or <a href=\"https:\/\/legalvision.co.uk\/membership\/\" target=\"_blank\" rel=\"noreferrer noopener\">visit our membership page<\/a>.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Frequently Asked Questions<\/h2>\n\n\n\n<div class=\"schema-faq wp-block-yoast-faq-block\"><div class=\"schema-faq-section\" id=\"faq-question-1773896611866\"><strong class=\"schema-faq-question\">What should I do if I discover a statement was false after signing a contract?<\/strong> <p class=\"schema-faq-answer\">You should act immediately and seek legal advice from a dispute resolution solicitor. Continuing to perform the contract or delaying your response may limit your ability to rescind the contract or recover damages.<\/p> <\/div> <div class=\"schema-faq-section\" id=\"faq-question-1773896626290\"><strong class=\"schema-faq-question\">Can I make a misrepresentation claim if I also have a breach of contract claim?<\/strong> <p class=\"schema-faq-answer\">Possibly, but the two claims are legally distinct. A disputes lawyer can assess the facts and advise you on which claim is stronger and most appropriate in your circumstances.<\/p> <\/div> <div class=\"schema-faq-section\" id=\"faq-question-1773896635657\"><strong class=\"schema-faq-question\">Should my business be careful about the statements it makes during negotiations?<\/strong> <p class=\"schema-faq-answer\">Yes. Any statement your business makes that a customer relies on when deciding to sign a contract could give rise to a misrepresentation claim if it later proves untrue. Make sure all statements are accurate, verifiable, and not misleading.<\/p> <\/div> <\/div>\n<div class=\"not-prose m-feedback-prompt\">\n    <!-- Thumbs up\/down bar -->\n    <div class=\"m-feedback-prompt__main\">\n        <div class=\"m-feedback-prompt__title\">Was this article helpful?<\/div>\n        <div>\n            <!--span class=\"m-feedback-prompt__button--text\">Thanks!<\/span-->\n            <button type=\"button\" class=\"m-feedback-prompt__button m-feedback-prompt__button--yes\"\n                    data-analytics-link=\"feedback-prompt:yes\" aria-label=\"Agree\">\n                <i class=\"fa-regular fa-thumbs-up fa-3x\"><\/i>\n            <\/button>\n            <button type=\"button\" class=\"m-feedback-prompt__button m-feedback-prompt__button--no\"\n                    data-analytics-link=\"feedback-prompt:no\" aria-label=\"Disagree\">\n                <i class=\"fa-regular fa-thumbs-down fa-3x\"><\/i>\n            <\/button>\n        <\/div>\n    <\/div>\n\n    <!-- Feedback form -->\n    <div class=\"m-feedback-prompt__form\">\n        <div class=\"m-feedback-prompt__form--thanks \">\n            <div>Thanks!<\/div>\n            <p>\n                We appreciate your feedback \u2013 your submission has been successfully received.            <\/p>\n        <\/div>\n        <form id=\"contact-form\" class=\"m-feedback-prompt__form--form\" action=\"\" method=\"post\">\n            <input type=\"hidden\" id=\"authenticity_token\" name=\"authenticity_token\" value=\"488c9024c8\" \/><input type=\"hidden\" name=\"_wp_http_referer\" value=\"\/api\/wp\/v2\/posts\/196376\" \/>            <input value=\"https:\/\/legalvision.co.uk\/commercial-contracts\/misrepresentation-act-1967-guide-small-businesses\/\" type=\"hidden\" name=\"currenturl\"\n                   id=\"currenturl\">\n            <input value=\"What is Misrepresentation? 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Understanding these rights can help you protect your business, respond effectively when things go wrong and avoid liability for your own pre-contractual statements. This article explores key rights and remedies available<a href=\"https:\/\/legalvision.co.uk\/commercial-contracts\/misrepresentation-act-1967-guide-small-businesses\/\">Continue reading <span class=\"sr-only\">&#8220;What is Misrepresentation? Guide for Small Businesses&#8221;<\/span><\/a><\/p>\n","protected":false},"author":13436,"featured_media":3251,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_relevanssi_hide_post":"","_relevanssi_hide_content":"","_relevanssi_pin_for_all":"","_relevanssi_pin_keywords":"","_relevanssi_unpin_keywords":"","_relevanssi_related_keywords":"","_relevanssi_related_include_ids":"","_relevanssi_related_exclude_ids":"","_relevanssi_related_no_append":"","_relevanssi_related_not_related":"","_relevanssi_related_posts":"","_relevanssi_noindex_reason":"","editor_notices":[],"footnotes":""},"categories":[37],"tags":[20,319,1646,2154,2620],"class_list":["post-196376","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-commercial-contracts","tag-small-business","tag-misrepresentation","tag-business-contracts","tag-contract-negotiations","tag-misrepresentation-act-1967"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.1.1 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>What is Misrepresentation? 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She is an experienced legal content writer who enjoys writing legal guides, blogs, and know-how tools for businesses. She studied History at University College London and then developed a passion for law, which inspired her to become a qualified lawyer. Sej enjoys drawing on her legal knowledge and practical commercial acumen to draft legal content that is commercially focused and easy for businesses to understand. She is passionate about breaking down complex legal concepts into clear and valuable insights which businesses can digest and learn from. Sej has a strong interest in fast-developing areas such as data privacy law and AI and has drafted articles which have been published in leading UK legal website publications, including The Lawyer and The Law Society Gazette websites.","sameAs":["https:\/\/www.linkedin.com\/in\/sejlamba\/"],"url":"https:\/\/legalvision.co.uk\/author\/sehajlamba\/"},{"@type":"Question","@id":"https:\/\/legalvision.co.uk\/commercial-contracts\/misrepresentation-act-1967-guide-small-businesses\/#faq-question-1773896611866","name":"What should I do if I discover a statement was false after signing a contract?","acceptedAnswer":{"@type":"Answer","text":"You should act immediately and seek legal advice from a dispute resolution solicitor. Continuing to perform the contract or delaying your response may limit your ability to rescind the contract or recover damages.","inLanguage":"en-GB"},"inLanguage":"en-GB"},{"@type":"Question","@id":"https:\/\/legalvision.co.uk\/commercial-contracts\/misrepresentation-act-1967-guide-small-businesses\/#faq-question-1773896626290","name":"Can I make a misrepresentation claim if I also have a breach of contract claim?","acceptedAnswer":{"@type":"Answer","text":"Possibly, but the two claims are legally distinct. A disputes lawyer can assess the facts and advise you on which claim is stronger and most appropriate in your circumstances.","inLanguage":"en-GB"},"inLanguage":"en-GB"},{"@type":"Question","@id":"https:\/\/legalvision.co.uk\/commercial-contracts\/misrepresentation-act-1967-guide-small-businesses\/#faq-question-1773896635657","name":"Should my business be careful about the statements it makes during negotiations?","acceptedAnswer":{"@type":"Answer","text":"Yes. Any statement your business makes that a customer relies on when deciding to sign a contract could give rise to a misrepresentation claim if it later proves untrue. Make sure all statements are accurate, verifiable, and not misleading.","inLanguage":"en-GB"},"inLanguage":"en-GB"}]}},"_links":{"self":[{"href":"https:\/\/legalvision.co.uk\/api\/wp\/v2\/posts\/196376","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/legalvision.co.uk\/api\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/legalvision.co.uk\/api\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/legalvision.co.uk\/api\/wp\/v2\/users\/13436"}],"replies":[{"embeddable":true,"href":"https:\/\/legalvision.co.uk\/api\/wp\/v2\/comments?post=196376"}],"version-history":[{"count":3,"href":"https:\/\/legalvision.co.uk\/api\/wp\/v2\/posts\/196376\/revisions"}],"predecessor-version":[{"id":196545,"href":"https:\/\/legalvision.co.uk\/api\/wp\/v2\/posts\/196376\/revisions\/196545"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/legalvision.co.uk\/api\/wp\/v2\/media\/3251"}],"wp:attachment":[{"href":"https:\/\/legalvision.co.uk\/api\/wp\/v2\/media?parent=196376"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/legalvision.co.uk\/api\/wp\/v2\/categories?post=196376"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/legalvision.co.uk\/api\/wp\/v2\/tags?post=196376"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}