Chapter 48: Misrepresentation by Concealment

§48.1 Generally

The Case: Body Invest, LLC. v. Cone Solvents, LLC, No. M2006-01723-COA-R3-CV,2007 WL 2198230 (Tenn. Ct. App. July 26, 2007).

The Basic Facts: Plaintiffs filed suit against defendant for allegedly supplying it with contaminated components that plaintiffs used in tanning products.

The Bottom Line:

• "[M]isrepresentation by concealment requires a plaintiff to prove the following elements: (1) the defendant concealed or misrepresented a material fact; (2) the defendant was under a duty to disclose the fact to the plaintiff; (3) the defendant intentionally concealed or suppressed the fact with the intent to deceive the plaintiff; (4) the plaintiff was not aware of the fact and would have acted differently if the plaintiff knew of the concealed or suppressed fact; and, (5) as a result of the concealment or suppression of the fact, the plaintiff sustained damage. T.P.I. 3-CIVIL 8.38; Lonning v. Jim Walter Homes, Inc., 725 S.W.2d 682, 685 (Tenn. Ct. App.1986)." 2007 WL 2198230 at *6.

Other Sources of Note: Cf. Rentea v. Rose , No. M2006-02076-COA-R3-CV, 2008 WL 1850911 (Tenn. Ct. App. Apr. 25, 2008) (mere silence is not enough; concealment may consist [of] withholding information asked for, or in making use of some device to mislead, thus involving act and intention); Lonning V. Jim Walter Homes, Inc. 725 S.W.2d 682 (Tenn. Ct. App. 1986) (for concealment or non-disclosure to constitute fraud, the defendant must have had knowledge of an existing fact or condition and a duty to disclose the fact or condition; a party to a contract has a duty to disclose to the other party any material fact affecting the essence of the subject matter of the contract, unless ordinary diligence would have revealed the undisclosed fact).

Recent Cases: Odom v. Oliver , No. W2008-01145-COA-R3-CV, 2009 WL 691879 (Tenn. Ct. App. Mar. 17, 2009) (reversing summary judgment finding sellers did not show buyers could not prove essential element of causation at trial); Rural Developments, LLC v. Tucker, No. M2008-00172-COA-R3-CV, 2009 WL 112541 (Tenn. Ct. App. Jan. 14, 2009) (affirming partial summary judgment dismissing intentional misrepresentation claim on different grounds than trial court finding no reasonable reliance); Orndorff v. Calahan, No. M2007-02060-COA-R3-CV, 2008 WL 4613546 (Tenn. Ct. App. Oct. 9, 2008) (upholding trial court's findings that plaintiffs' reasonably relied on representations by defendants).

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