Distinction between fraud and misrepresentation

The principal difference between fraud and misrepresentation is that in the case of fraud the person making representation does not believe it to be true. And in the case of misrepresentation he believes it to be true But in both cases, it is mis-statement of fact which misleads the other party. Again fraud not only affords a ground for avoiding the contract, it also enabled the party defrauded to bring an action in tort for damages whereas misrepresentation merely affords a ground for avoiding the contract and not for bringing an action in tort. When recession is claimed, it is only necessary to prove that there was misrepresentation then however honestly it may have been made, however, free from blame the person who made it may be, the contract, having been obtained by misrepresentation, cannot stand. But in order to sustain an action for deceit, there must be proof of fraud; and fraud is proved only when it is shown that a false statement has been made knowingly or without belief in its truth, or recklessly, carelessly whether it is true or false. Again in case of misrepresentation the fact that the plaintiff had that means of discovering the truth by exercising ordinary diligence, can be good defence against the repudiation of the contract, whereas such a defence cannot be set up in the case of fraud other than fraudulent silence {Exception to Section 19}.

Courtesy:- Legal Point Foundation