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"Fraud in the Inducement"

Alabama Contract Fraud

AL Code § 6-5-101 (2021)

“Misrepresentations of a material fact made willfully to deceive, or recklessly without knowledge, and acted on by the opposite party, or if made by mistake and innocently and acted on by the opposite party, constitute legal fraud.”

Under Alabama law fraud includes legal fraud, which encompasses misrepresentations of material fact made by mistake and innocently, as well as those made either willfully to deceive or recklessly without knowledge.

To prevail under a legal fraud claim, the party asserting the fraud must show that (1) there was a false representation; (2) it concerned a material fact; (3) the complaining party reasonably relied on the material misrepresentation; and (4) the party asserting fraud was damaged as a proximate result. Dodd, 626 So. 2d at 1291.

As a threshold matter, the representation must be false, and the false representation must be reasonably specific. Moreover, the fact misrepresented must be "material" in the sense that it is of such a nature to induce the complaining party to enter the contract.

Atty Greg Staney 205.451.4196

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