Commentary

230.2 Excluding the seller’s liability for misrepresentation

BUSINESSES vol 4(2) start-up, sale and purchase
| Commentary

230.2 Excluding the seller’s liability for misrepresentation

| Commentary

230.2 Excluding the seller’s liability for misrepresentation

In addition to limiting his liability in respect of breach of the warranties, the seller will usually seek to exclude his liability for misrepresentation.

The principle of ‘caveat emptor’ applies to the sale of a business1. Therefore each party must look out for himself and ensure that he acquires the information necessary to avoid a bad bargain. Hence the need for the buyer and his advisers to make necessary enquiries before the contract is made. On the other hand, a contract for the sale of a business is subject to the doctrine of misrepresentation

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