Contractual negotiation and negligent misrepresentations

[Sapphire Capital]

Misrepresentations and unfounded assertions of fact made to a party during pre-contractual negotiations can come back to bite you if they induce that party to enter into the contract. The UK Supreme Court emphasised that misrepresentations made to a non-contracting party can also result in liability for the party that made the misrepresentation.
(https://www.supremecourt.uk/decided-cases/docs/UKSC_2012_0025_Judgment.pdf)
and in a technology circumstance BSkyB Ltd v HP Enterprise Services UK Ltd (http://www.thesolicitorsgroup.com/Downloads/Articles/26Apr2010/Contract-FraudulentMisrepresentationClaimUpheld.pdf)
or generally www.lawteacher.net/cases/contract-law/misrepresentation-cases.php

An old article can be found going into general principals can be found at scholarship.law.marquette.edu/cgi/viewcontent.cgi?article=2952&context=mulr

You find similar decisions in all common law based countries and while the angle is a bit different under the jurisdictions following the Roman law / French law directives, the outcome is almost always the same. Difficult to litigate but not impossible.


Negotiating Ethics counts, Take it seriously because walking on the fringes can cost you!

[anenro]

So, people acting like a "licensed" financial broker can claim or demand financial compensation for simply forwarding an email to a financial service provider?

May I suggest you dig deeper into current court cases, where the complaining party, who happens to be unlicensed and is offering financial services, filed a case and won.

I can not find such court case.

Please comment.

Thank you.

[anenro]

Interesting article: www.forc.org/pdfs/vol13-ed2-art3.pdf

[Sapphire Capital]

the posting was done in general, its an attempt to get people to pay attention, if you want a complete write down on a legal situation I suggest you pay a lawyer to do it. Financial service law is a specialized matter and depends very much on your jurisdiction, what applies in general is usually altered following coded laws and regulations, which are different depending on jurisdiction and area of finance.

[Sapphire Capital]

Sept 5, 2015 16:01:34 GMT 4 anenro said:

Interesting article: www.forc.org/pdfs/vol13-ed2-art3.pdf

on the link you posted you bring forward another aspect that has long been discussed in this and other fori by myself, the unregistered broker or finder often gets nothing because he has no standing, however if all the participants in a broker chain are unregistered and the principal has willingly engaged them some courts take the blame to the principal and he has to pay nevertheless. However that usually triggers an inquiry from taxes and state authorities and often such funds are placed in trust pending a registration or a settlement and penalty fees.

The devil is in the detail and not all US states have laws as NY or California. In other countries its sometimes regulated but not always, usually G30 countries will have a regulation on those handlings.

That does however not mean the principal has no liability for misrepresentations and it does not mean the broker , registered or unregistered, has no liability for misrepresentations. The topic of the payment of the unregistered broker is separate from misrepresentations.

[conflict]

we discussed the finder fee topic in the US a long time ago at
sapphirecapital.proboards.com/thread/317/non-licenced-financial-brokers
there are probably new developments since 2008