Louisiana has several “vices of consent” that will void a contract. These grounds essentially prevent a contract from ever being formed and include error/mistake, duress, and fraud.
Fraud claims are fairly common and can be complicated. To better understand them, here are some things to know about Louisiana fraud claims.
Understanding Louisiana Fraud Claims
1. Elements of a Fraud Claim
In order to establish a claim for fraud, you have to show the following elements: (1) an intentional misrepresentation or omission of the truth, (2) the misrepresentation or omission was made with the intent to gain an unjust advantage or to cause damage or inconvenience to the defrauded party, and (3) the misrepresentation substantially influenced the defrauded party’s consent.
2. Relationship of Confidence
Though a party may not be excused from his or her neglect in discovering fraud, this does not apply if there is a relationship of confidence between the parties. However, this relationship must be such that it “reasonably induced a party to rely on the other’s assertions or representations.”
3. Third-Party Fraud
Louisiana law allows for a contract to be rescinded for fraud committed by a third-party (i.e., somebody who is not a party to the contract). This requires a showing that the other party knew or should have known of the fraud.
4. Damages for a Louisiana Fraud Claim
The Louisiana Civil Code allows for damages from “the party against whom rescission is granted.” Fraud claims are one of the few instances where a party can be awarded attorney’s fees as an item of damages. This is because Louisiana only allows for attorney’s fees awards where they are allowed by a contract or by a statute. Here, the statute specifically allows for them.
New Orleans Commercial Litigation Lawyer
The Mahone Firm has experience handling a wide variety of commercial and other business matters, including fraud claims. If you’re involved in a business dispute, call (504) 564-7342 to discuss your case with an attorney today.
