''Bisset v Wilkinson'' 927AC 177 is a leading

contract law A contract is a legally enforceable agreement between two or more parties that creates, defines, and governs mutual rights and obligations between them. A contract typically involves the transfer of goods, services, money, or a promise to tran ...

case from

New Zealand New Zealand ( mi, Aotearoa ) is an island country in the southwestern Pacific Ocean. It consists of two main landmasses—the North Island () and the South Island ()—and over 700 smaller islands. It is the sixth-largest island count ...

on the issue of

misrepresentation In common law jurisdictions, a misrepresentation is a false or misleading '' R v Kylsant'' 931/ref> statement of fact made during negotiations by one party to another, the statement then inducing that other party to enter into a contract. The ...

. The case establishes that a mere misstatement of opinion given fairly cannot amount to a misrepresentation. The case was heard in London by the Privy Council, which was then the final appeal court for New Zealand. As such, the decision, although "very strongly persuasive" on English contract law, is not conclusively binding. Nevertheless, the case has been cited and applied in England and Wales several times.

Facts

In New Zealand in May 1919 Mr Bisset entered into a binding contract to sell to Mr Wilkinson two contiguous blocks of farmland for £13,260. These blocks comprised respectively. During negotiations Bisset told Wilkinson that "with a good six horse team, his idea was that the farm would carry 2,000 sheep". After 2 years of unsuccessful farming, Wilkison concluded that the land could not support 2,000 sheep, and he brought an action for misrepresentation to cancel the contract and get his money back.

Advice

The Privy Council advised that the statements about the farmland could not amount a serious representation based on Bisset's knowledge. At the time of the deal, both parties understood that Bisset had not used the land for sheep farming, and thus any statement as to the farmland's capacity would only be an estimate. Giving the leading judgment, Lord Merrivale stated that important considerations were the ‘material facts of the transaction, the knowledge of the respective parties and their relative positions, the words of representation used, and the actual condition of the subject-matter spoken of …’. The judge added: In addition, Lord Merrivale noted that Wilkinson had "failed to prove that the farm (if properly managed) was incapable of being occupied by two thousand sheep". Viscount Dunedin, Lord Atkinson, Lord Phillimore and Lord Carson agreed.

Significance

The case clarifies that a misstatement of "fact" may be a misrepresentation, but misstatements of opinion, intention or law are not. By contrast, in situations where one party has specialist knowledge of the subject (so that his "opinion" is one which is effectively a "statement of fact") then the misstatement becomes an actionable misrepresentation, as in '' Esso Petroleum Co Ltd v Mardon'', and in '' Smith v Land & House Property Corp''.''Smith v Land & House Property Corp'' (1885)

References

{{DEFAULTSORT:Bisset V Wilkinson New Zealand contract case law English misrepresentation case law Judicial Committee of the Privy Council cases on appeal from New Zealand 1926 in case law 1926 in New Zealand law

Facts

Advice

Significance

See also

References