Negligent misrepresentation involves many of the elements of intentional misrepresentation, althoughthis cause of action is characterized by a less culpable mental state. Thus, the plaintiff in a negligentmisrepresentation case must prove: 1) a misrepresentation of material fact; 2) intent to induce reliance;3) justifiable reliance on the misrepresentation; and 4) resulting damage. The scienter element differs,however; negligent misrepresentation occurs when a defendants false statement is made without areasonable ground for a belief in the truth of the misrepresented fact. The liability in these cases isessentially negligence liability, although the application of negligence defenses is subject to somecontroversy
See §1861.3.§1804 Constructive FraudWhen there is a fiduciary or confidential relationship between the plaintiff and the defendant, the lawrecognizes a fourth species of fraud, i.e., constructive fraud. In general,
fraud consists of any breach of duty by a person who, without an actual fraudulent intent, gains an advantage bymisleading another to his prejudice or to the prejudice of anyone claiming under him
Cal.Civ.Code§1573. In this respect, constructive fraud resembles fraudulent concealment (or non-disclosure), but it isnot identical. As with fraudulent concealment, constructive fraud requires some relation between theparties giving rise to an affirmative duty to disclose. However, unlike fraudulent concealment, a findingof constructive fraud is not subject to the requirement that the failure to disclose material facts beintentional.
, 219 Cal. App. 3d 926 (1990). Despite the absence of an intentrequirement, many of the interrogatories set forth in this section on fraudulent concealment may beadapted for use in constructive fraud cases.§1805 A Note on Election of RemediesFraud claims pose difficult questions relating to the requirement that a plaintiff elect betweenpotentially inconsistent remedies. When a plaintiff has been induced by a defendants fraud to enterinto a contractual relationship, the plaintiff must elect between affirming the contract (and seekingdamages), or rescinding the contract (and seeking restitution). The distinctions between restitution anddamage remedies, together with an in depth analysis of the requirement that plaintiff elect hisremedies, is set forth in 3 Witkin,
(4th ed. 1997) §175
refers to the statement, representation, or concealment which is the subject of theplaintiffs complaint .For other definitions that are utilized throughout this book, see §102.§1820 Identification of DefendantAs in other tort cases, it is important that you specifically identify the opposing party, whether a party isa natural person, corporation, partnership, or sole proprietorship. When the opposing party operatesunder any of these business forms, these questions will elicit additional information that may