Source: https://www.moghullaw.com/blog/2018/09/what-is-fraud-under-virginia-law.shtml
Timestamp: 2019-04-20 06:34:29+00:00

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The difference between actual and constructive fraud is often confused by lawyers who do not understand fraud. Actual fraud requires the element of intent - that is, knowingly or intentionally making a misleading statement of material fact - whereas constructive fraud does not require such intent.
The elements of a claim for fraud must be pled with particularity, and the standard for proving fraud is especially rigorous.
Resulting In Damage to the Plaintiff.
see Evaluation Research Corp. v. Alequin, 247 Va. 143, 148 (1994). Unlike other civil causes of action, a fraud action must be proven by clear and convincing evidence. Let us examine each element in turn.
The language "by the exercise of due diligence reasonable should have been discovered," as used in Code § 8.01-249, means "such a measure of prudence, activity or assiduity, as is property to be expected from, and ordinarily exercised by, a reasonable and prudent man under the particular circumstances; not measured by any absolute standard, but depending on the relative facts of the special case."
A claim for fraud must be based on a misrepresentation of a material fact. There are some crucial considerations that a Virginia resident must keep in mind before deciding to pursue a claim for fraud.
In a real estate transaction, a statement by a seller that the roofing on the house was "installed last week" when it was actually 10 years old, would be an intentional misrepresentation of material fact if buyer reasonably relied on this statement and was ultimately harmed by it.
Conversely, if the seller of the house states that in his opinion, the house is absolutely fantastic and a great bargain - that would be a nonactionable statement of opinion.
NON-ACTIONABLE STATEMENT OF OPINION. While selling his house, James - who is a doctor by profession - tells the buyer that in his opinion, this house has "solid foundations," and would give the buyer no problems whatsoever. In reality, the house has severe structural problems and the base of the house is likely to collapse. This would arguably constitute a non-actionable statement of opinion.
ACTIONABLE FRAUD. Contrast the aforementioned example with this: Rennick is an expert real estate broker who knowingly proffers a false "opinion" to the buyer that the house has solid foundations. In this case, Rennick has arguably committed fraud.
Whether a statement is one of fact or opinion depends on the unique circumstances of that case. However, some important factors are whether the statement is provably true or false and if it was reasonable for the plaintiff to rely on such a statement.
Fraud by Concealment - When Silence Can Constitute Fraud.
Sometimes fraud may be the result of active concealment of a material fact, as opposed to fraud by affirmative misrepresentations. "Concealment by material fact by one who knows that the other party is acting upon the assumption that the fact does not exist constitutes actionable fraud" (Allen Realty Corp. v. Holbert, 227 Va. 441, 450, 318 S.E.2d 350 (1986).
Ware v. Scott, 220 Va. 317, 257 S.E.2d 855 (Va., 1979): The Wares listed their house for sale with a realtor. Interested buyers, the Scotts, inquire whether "there had ever been any water problems". The Wares state that, "The only water we've had is some seepage around the chimney, but it has been repaired." The Wares did not mention that earlier, storm water from an overflowing drainpipe at the rear of the lot had overturned a stone wall along one side of the property. Upon taking possession, the Wares discover the flooding from the drainage pipe and sue the Wares for fraudulent inducement. Issue: whether the sellers are liable for damages resulting from their failure to disclose certain information material to the sale contract and acquired by them after the contract document was signed but before the sale was consummated? HELD, that fraudulent inducement need not necessarily be limited to the formation of the contract, it can be based on the performance of an executory contract. Such a situation arises when "one party fraudulently leads the other to believe that a condition precedent to the latter's duty to perform has been fulfilled." The trial judge found that "Mrs. Ware's statement to Mrs. Scott did not amount to an intentional misrepresentation but that the Wares' concealment of the May 23 flood and its consequences was fraudulent."
To make an actionable case for fraud, the injured party must prove reasonable reliance on the misrepresentations made by the defrauding party. Remember, it is important to demonstrate that the injured party's reliance was "reasonable." In the context of fraud, the party alleged to have committed fraud often argues a lack of reasonable reliance on the grounds that the facts that led the injured party to enter into the transaction could have been discovered by a reasonable investigation. Thus, the "reasonableness" of the reliance often becomes a fact-intensive query.
A plaintiff must have suffered damages in order to successfully pursue a claim for fraud. Showing mere damages are not enough, as the plaintiff must show that the damages were directly and proximately caused by the fraud of the defrauding party. While fraud must be proven by clear and convincing evidence, the damages need only be proven by the greater weight of the evidence. Jefferson Standard Life Ins. Co. v. Hedrick, 181 Va. 824, 835, 27 S.E.2d 198, 203 (1943).
Damages for fraud can include attorneys' fees (Prospect Development Company, Inc. v. Bershader, 258 Va. 75, 92, 515 S.E.2d 291, 300 (1999).

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