Opinion ID: 794123
Heading Depth: 2
Heading Rank: 2

Heading: Misrepresentation in the Letter of Direction

Text: 18 Cordry argues that Vanderbilt made a fraudulent or negligent misrepresentation in the Letter of Direction by promising to honor the same terms and conditions of the dealer agreements originally between DFS and [Cordry]. In particular, Cordry argues that this statement was made fraudulently or negligently because Vanderbilt always intended to use its own risk-evaluation program and spreadsheets, rather than DFS's risk-evaluation program and spreadsheets, to determine finance levels for Cordry's used manufactured homes. 19 The elements of fraudulent misrepresentation under Missouri law are: (1) the representation is false; (2) the representation is material; (3) the speaker knows of the representation's falsity; (4) the speaker intends the hearer to act on the representation in the manner reasonably contemplated; (5) the hearer is ignorant of the representation's falsity; (6) the hearer relies on the representation's truth; (7) the hearer has a right to rely on the representation; and (8) the hearer is consequently and proximately injured. Joel Bianco Kawasaki Plus, Inc. v. Meramec Valley Bank, 81 S.W.3d 528, 536 (Mo. banc 2002). Negligent misrepresentation differs primarily in that the speaker must only fail to exercise reasonable care or competence in obtaining or communicating th[e] information, rather than know of its falsity. M & H Enters. v. Tri-State Delta Chems., Inc., 35 S.W.3d 899, 904 (Mo.Ct. App.2001). 20 Vanderbilt represented that it would honor the terms and conditions of the dealer agreements originally between DFS and [Cordry]. The dealer agreements originally between DFS and Cordry were the financing agreement and addendum. To show that Vanderbilt's intention to use its own risk-evaluation program and spreadsheets rendered the representation false, Cordry must show that the terms and conditions of the financing agreement and addendum bound the finance company to use a particular risk-evaluation program and spreadsheets. The record indicates that a finance company uses its risk-evaluation program and spreadsheets to determine an appropriate financing level based on the details of the mobile home to be financed, the retailer's circumstances and other variables. As discussed above, ¶ 2 of the financing agreement carefully excludes from the agreement any binding constraints on how such variables are to be used to determine a finance level for each mobile home. The only reasonable conclusion is that the parties did not intend to require the finance company to use a particular risk-evaluation program and spreadsheets throughout the duration of the agreement. Therefore, Vanderbilt's intention to use its own program and spreadsheets does not render false its promise to honor the terms of the dealer agreements, and Cordry's misrepresentation claims must fail. 21