Misrepresentation – webinar

Anne sees an advertisement

“Booming dog grooming business. Pedigree service. Current owner retiring. Call Katie for details’”

Anne calls round to see Katie. Anne is very impressed by the pictures of the winner of this year’s Wufts, who Anne assumes is a customer of the salon. She tells Katie that she believes that with such pedigree clients she will be able to make a good living. Katie says ‘she is sure she would’.

Katie tells Anne that she is getting a licence to provide ‘bodog’ injections for her clients pets. Unfortunately the day before the contract of sale is complete the licence is denied due to concerns to animal welfare. Katie doesn’t mention this to Anne. However Anne has arranged to employ an expert vetinary nurse to perform the injections at a salary of £15,000 pa.

Katie states that the turnover is £100,000 pa,. This is true but the largest customer is the local dog club, they have cancelled their contract with the salon as they are going to use the new salon that Katie is opening closer to their offices. Katie makes a profit in his first year of £200,000 from this new salon.

Anne asks her friend Luke to check the accounts, he takes a quick look and calls Anne and says that the business ‘seems a good prospect’.

Anne & Katie meet to sign the contract, Anne fails to read it carefully and misses clause 26 out of 59 which excludes liability for any misrepresentations made during negotiations. Anne wishes Katie good luck in her retirement and says that she is glad not to have any competition in the locality.

In the first three months Anne has lost £20,000 and her new nurse has nothing to do.

Advise Anne on her potential legal rights against Katie.