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AMI 2433 Defense—Fraud in Inducement

Arkansas Supreme Court Committee On Jury Instructions-Civil

Ark. Model Jury Instr., Civil AMI 2433

Arkansas Model Jury Instructions-Civil

December 2023 Update

Arkansas Supreme Court Committee On Jury Instructions-Civil

Chapter 24. Contracts

Defenses

AMI 2433 Defense—Fraud in Inducement

[Defendant] contends that [plaintiff] fraudulently induced [him][her][it] to enter into the contract and has the burden of proving each of five essential propositions:

First, that [plaintiff] made a false representation of material fact concerning the contract;

Second, that [plaintiff] knew that the representation was false when it was made;

Third, that the representation was made for the purpose of inducing [defendant] to enter into the contract;

Fourth, that [defendant] justifiably relied upon the representation; and

Fifth, that [defendant] would not have entered into the contract except for the false representation.

A fact or statement is material if it was a substantial factor in influencing [defendant]'s decision. It is not necessary, however, that it be the paramount or decisive factor, but only one that a reasonable person would attach importance to it in making a decision.

[If you find from the evidence in this case that each of these propositions has been proved, then your verdict should be for [defendant]].

NOTE ON USE

Do not use the bracketed sentence if the case is submitted on interrogatories.

COMMENT

This instruction is based on Undem v. First Nat. Bank, Springdale, Ark., 46 Ark. App. 158, 164, 879 S.W.2d 451, 454 (1994) (question of fact existed as to whether former director of borrower could avoid liability on a note to the bank because bank's agent fraudulently induced him to sign note by falsely representing that he would not be liable unless he remained on the borrower's board of directors); and AMI 402. This instruction does not address fraud by concealment or failure to disclose. If the alleged fraud is concealment or failure to disclose, this instruction should be modified. See discussion in Comment to AMI 402 on when silence can be actionable fraud.

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