Question A Issue The main issue here is whether silence of a party regarding certain facts related to the agreement amount to fraud. When this happens, what are the consequences if one of the parties has maintained silence over a material fact of the agreement? Law and Application Misrepresentation normally refers to certain false statement made by representator and which induces the other party to enter into a contract but the representor does not intend to deceive. Therefore, according to Contracts Act 1950, there are two types of misrepresentation, which are fraud and misrepresentation. The first type of misrepresentation is fraud. Fraud is defined in Section 17 Contracts Act 1950, to include that various acts committed by a party with intent to deceive the other contracting party. As a simplification, fraud is done with the intention of wrongful personal gains or to cause damage to another person. In brief, when one person is cheating purposefully on gaining at the expense of another party, he is said to have committed in fraud. However, there is no misrepresentation while the aggrieved party can discover the truth by himself, thus, the aggrieved party has the authority to stop the agreement and so claim for the losses. On the other hand, another type of misrepresentation falls under Section 18 Contracts Act 1950, an untrue statement of fact made by one party to the other which was intended and did induce the latter to enter into the contract but the representator does not intent to deceive. Misrepresentation is mostly used in the context of contracts where an innocent party presents wrong facts which he was told by someone else asserted to be the truth as to lure other party into signing the contract. Generally speaking, misrepresentation is merely not presenting entire information and it sometimes takes place as the person may not have knowledge of entire facts. As a result, the aggrieved party cannot terminate the contract or claim for the damages. According to explanation Section 17 Contracts Act 1950, silence does not amount to fraud unless there is a duty to speak. In other words, generally, silence is not a misrepresentation. The effect of this rule is that the other party has no duty to disclose problems voluntarily. As a result, if one party is labouring under a misapprehension there is no duty on the other party to correct it. However, there are some exceptions in this rule. One of it is the Uberrimae Fidei Contracts (Contracts of the Utmost Good Faith). It imposes duty of disclosure of all material facts because one party is in a strong position to know the truth (“Contracts Uberrimae Fidei”, n.d.). Example would include contracts of insurance, the nature of contract is a legal duty on the insured to disclose material facts that is