The claim requires a false statement in the course of business, failure to exercise reasonable care in obtaining or communicating it, justifiable reliance, and pecuniary loss. Scienter is not required.
Liability extends to a limited class of foreseeable users.
Alternative Names:
Negligent Misstatement|Commercial Negligent Misrepresentation
Why it Matters?
The economic loss doctrine bars the claim in many jurisdictions where the parties are in contractual privity, channeling the dispute to contract remedies. Whether that bar applies to negligent misrepresentation specifically varies substantially and is worth confirming early. The limited class limitation also restricts liability for professionals such as accountants to persons the maker intended to influence, rather than all foreseeable readers of a report.
Frequently Confused with
Related terms
Frequently asked questions
Does the economic loss doctrine bar the claim?
Who may recover from a professional?
