A material fact is a fact that is important, significant or essential to a reasonable person in deciding whether to engage or not to engage in a particular transaction. Material misrepresentation of material fact, is the intentional omission of a material fact in order to motivate a certain transaction to take place. In these cases, the material fact would generally be considered negative against the value represented by the transaction. Misrepresentation of material fact is common in real estate transactions both commercial and residential. It can also take place in business transactions, such as in the buying or selling of a company.
Many agreements include clauses that protect the seller in the event that a material fact is unknown and discovered after the transaction so long as the seller was unaware of that fact until that time. However, intentionally hiding a material fact to motivate a transaction is illegal.
Plaintiff & Defendant Trial Goals
Your goal at trial will be different depending on which side you represent in a case involving misrepresentation of material fact in California. As the plaintiff, you will be trying to claim that the defendant hid the material fact intentionally to motivate the sale. As the defendant, you will be claiming that the plaintiff already knew the material fact, the material fact was unbeknownst to both parties, or even that the plaintiff caused the “material fact” themselves after the sale.
Sometimes misrepresentation of material fact is really obvious. Take this real estate law situation for example. Imagine a home’s basement being invaded with serious water intrusion for months. The long-time home owner discovers the problem in the clearly rotting wood and covers it up with new, thin wood panels to hide the problem before it goes up for sale.
The seller does not inform the buyer of the issue and sells the home. Right after the buyer moves in, he removes what he knows is not the original paneling and discovers the problem. It would be pretty obvious what the seller had done, and taking photos of the damage and hiring a home inspector could be evidence enough to present in court and win. In other situations though, the intent may not be so obvious. In these cases, the burden of proof is on the plaintiff to prove that the seller (defendant) intentionally mislead the plaintiff against their own best interests.
Benefits of Hiring an Attorney
Depending on the amount of the damage or the value lost by the material misrepresentation, some plaintiff’s may attempt to try the case on their own. However, a much better option, especially in cases involving values of $25,000 or more, is hiring an attorney to present your case. This is especially true if you are the defendant and the value of the damages is high.
As the plaintiff, you can potentially sue against the difference in value or damages plus attorney fees. You may even sue to rescind and invalidate the sale, return your money, and recover attorney fees and/or other damages such as injuries and hard costs.
An attorney knows the law and can present the evidence during your case appropriately to show the validity of it. If you are the plaintiff, you may have spent a lot of money on something with a defect that makes your investment at a loss. If you are the defendant, you want to shield yourself and your sale assets from any litigation against you for damages. An attorney can be your ultimate defense in protecting you from losses during a trial.
Are You Seeking an Attorney for Material Misrepresentation?
Whether you are the plaintiff or defendant in a legal case, Webb Law Group can assist you. Our law firm has years of experience dealing with business and real estate litigation matters including working as attorneys in misrepresentation of material fact cases. We are happy to review your case and advise you on how we can help and what to do next.
Webb Law Group is a reputable business and real estate law firm with experience in matters involving California Law, including handling business and real estate litigation matters. Having a reputable attorney by your side for these matters will help give you the best possible chance of a positive outcome in your case. If you feel you need legal representation, we are happy to review your legal needs and provide consultation and support where necessary.
For questions, or to schedule a consultation, contact us today at (559) 431-4888 (Fresno) or (619) 399-7700 (San Diego).