WPI 165.02 Negligent Misrepresentation—Failure to Disclose Information—Burden of Proof on the I...

The instruction sets forth the elements for a claim of negligent misrepresentation that is based on a failure to disclose information. For cases involving a claim of negligent misrepresentation that is based on affirmative misstatements, use WPI 165.01 (Negligent Misrepresentation—Affirmative Misstatement—Burden of Proof on the Issues) instead of this instruction.

Element (4) is set forth in brackets. It should be used in cases involving a factual dispute as to whether the defendant's nondisclosure was material to the plaintiff's decision to complete the transaction. For example, in a guaranty case a jury might find that, even if the relevant information had been disclosed, the plaintiff would have entered into the guaranty relationship anyway. On the other hand, a jury might find that that if the plaintiff had been made aware of the undisclosed information she would not have become a guarantor. In such cases the element is appropriately included. By contrast, in cases where the primary effect of the disclosure of the information would have been to affect the terms of the transaction, such as the price, the causation element is sufficiently expressed in the damages instruction and element (4) may be omitted.

Use WPI 10.01 (Negligence—Adult—Definition), the applicable proximate cause instruction from WPI Chapter 15 (Proximate Cause), and one of the two instructions that address the clear, cogent, and convincing standard of proof: WPI 165.05 (Negligent Misrepresentation—Clear, Cogent, And Convincing Evidence) or WPI 165.06 (Negligent Misrepresentation—Clear, Cogent, And Convincing Evidence—Combined With Preponderance of Evidence) with this instruction.

See discussion in the Comment below.

Duty. The question of whether a defendant owed the plaintiff a duty of care is frequently referred to as a question of law for the court. See the Comment to WPI 165.03 (Negligent Misrepresentation—Failure To Disclose Information—Duty To Disclose).

The instruction is based on the standards from section 551(1) of the Restatement (Second) of Torts, which has been adopted as Washington law. See Colonial Imps., Inc. v. Carlton N.W., Inc., 121 Wn.2d 726, 731, 853 P.2d 913 (1993); Guarino v. Interactive Objects, Inc., 122 Wn.App. 95, 129–30, 86 P.3d 1175 (2004). Restatement (Second) of Torts § 551(1) (1977) reads:

Under section 551(1), liability extends only to circumstances when the defendant had a duty to exercise reasonable care in disclosing the information. The circumstances under which this duty arises are addressed in the second paragraph of section 551 and in WPI 165.03 (Negligent Misrepresentation—Failure to Disclose Information—Duty to Disclose).

As indicated in WPI 165.00 (Negligent Misrepresentation—Introduction), the pattern instruction follows the approach of the Restatement (Second) of Torts section 551 in setting forth duties to disclose that are based on the common law. A duty to disclose information may also be imposed by contract or statute. For such cases, the instruction above may be modified. Some statutory duties may be created as part of a scheme that includes special statutory remedies; for such duties, a determination may need to be made whether the special remedy was intended to preempt other remedies, such as a negligent misrepresentation claim.

Reliance/Causation. In cases involving an affirmative misrepresentation, the plaintiff must prove reliance upon the misrepresentation in order to recover. However, where there is a failure to disclose it would be awkward to suggest that the plaintiff relied upon the absence of a fact or circumstance in choosing a course of action. Instead, the plaintiff must prove that, had the defendant disclosed the information in question, the plaintiff would have taken a different course of action. Ordinarily this is incorporated into the plaintiff's proof of the damage that resulted from the failure to disclose—the difference between how the transaction turned out and what the plaintiff now claims would have occurred if the missing information had been disclosed. However, in addition to the plaintiff's assertion that he, she, or they would have acted differently, the missing information must be sufficiently material to justify the remedies for misrepresentation.