WPI 165.03 Negligent Misrepresentation—Failure to Disclose Information—Duty to Disclose
6A WAPRAC WPI 165.03Washington Practice Series TMWashington Pattern Jury Instructions--Civil
6A Wash. Prac., Wash. Pattern Jury Instr. Civ. WPI 165.03 (7th ed.)
Washington Practice Series TM
Washington Pattern Jury Instructions--Civil
April 2022 Update
Part XII. Fraud
Chapter 165. Negligent Misrepresentation
WPI 165.03 Negligent Misrepresentation—Failure to Disclose Information—Duty to Disclose
A party to a business transaction has a duty to disclose to the other party, before the transaction is completed, the following information under [any of] these circumstances:
[(a)] [matters known to the party that the other is entitled to know because of a fiduciary relationship between them;]
[(b)] [facts basic to the transaction, if the party knows that the other is about to enter into it under a mistake as to them, and that the other, because of the relationship between them, the customs of the trade or other objective circumstances, would reasonably expect a disclosure of those facts;]
[(c)] [matters known to the party that the other is entitled to know because of a relationship of trust and confidence between them;]
[(d)] [matters known to the party that the party knows to be necessary to prevent the party's partial or ambiguous statement of the facts from being misleading;]
[(e)] [subsequently acquired information that the party knows will make untrue or misleading a previous representation that when made was true or believed to be so;]
[(f)] [the falsity of a representation made without the expectation that it would be acted upon, if the party subsequently learns that the other is about to act in reliance upon it in their transaction].
[Other than in these circumstances, a party to a business transaction is not required to disclose information to the other party.]
NOTE ON USE
Use WPI 165.02 (Negligent Misrepresentation—Failure to Disclose Information—Burden of Proof on the Issues) with this instruction if there are disputed questions of fact that prevent the court from determining the duty issue as a matter of law. Use WPI 165.04 (Negligent Misrepresentation—Failure to Disclose Information—Fiduciary Relationship—Relationship of Trust and Confidence—Definition) with this instruction, as applicable.
Paragraphs (a) and (b) are more likely to involve issues of law that would frequently be resolved by summary judgment, while paragraphs (c) through (f) would frequently involve factual issues for the jury. To the extent that any of these are determined as a matter of law before trial, the instruction would need to be modified accordingly.
Choose from items (a) through (f) according to the facts and claims involved in the particular case. The bracketed final sentence may be used if it would help jurors to better understand the legal framework.
COMMENT
The instruction is based on Section 551(2) of the Restatement (Second) of Torts, which has been adopted as Washington law. See Specialty Asphalt & Constr., LLC v. Lincoln Cnty., 191 Wn.2d 182, 421 P.3d 925 (2018); 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(2) (1977) reads:
Duty. Whether or not the defendant owed a duty of care is usually a question of law for the court. Eastwood v. Horse Harbor Found., Inc., 170 Wn.2d 380, 394, 241 P.3d 1256 (2010); Schaaf v. Highfield, 127 Wn.2d 17, 21–22, 896 P.2d 665 (1995); Austin v. Ettl, 171 Wn.App. 82, 89, 286 P.3d 85 (2012) (concluding in the context of a CR 12(b)(6) motion that no duty existed). Sometimes, however, cases will arise where the plaintiff and the defendant present conflicting evidence concerning the facts that would give rise to a duty of care. In such cases it may be desirable to craft a special verdict form that would permit the jury to resolve the disputed factual issues while reserving the legal determination to the court. A similar process is contemplated in the determination of whether or not an attorney owes a duty to a putative client, or to a non-client, for purposes of a claim of legal malpractice. See WPI 107.03 (Duty to Non-Client—Special Verdict Form).
Organization of instruction. The organization of paragraphs (a) through (f) in the pattern instruction differs slightly from the organization of paragraphs (a) through (e) of Restatement (Second) of Torts section 551(2). Paragraph (a) of the Restatement (Second) has been separated into two separate paragraphs in the pattern instruction, one specific to fiduciary relationships and the other specific to relationships of trust and confidence. Also, the order of the paragraphs has been revised, so that the pattern instruction begins with those paragraphs that tend to involve issues of law and ends with those paragraphs that tend to be more fact-specific.
“Facts basic to the transaction.” Paragraph (b) of the instruction refers to facts that are basic to the transaction. A comment to the Restatement (Second) defines “a fact basic to the transaction” as “a fact that is assumed by the parties as a basis for the transaction itself.” See Restatement (Second) of Torts § 551 cmt. j (1977). The comment indicates that the fact must “[go] to the basis, or essence, of the transaction,” and that even some “important and persuasive inducements to enter into the transaction” do not necessarily go to its essence. Restatement (Second) of Torts § 551 cmt. j (1977). In a particular case, jurors may need to be instructed in these regards. In other cases, the facts that are basic to a transaction may be determined by a statute, in which case the instructions would need to incorporate the statutory language.
Instruction—Exception to the general rule of caveat emptor. The instruction sets forth circumstances under which one party to a business transaction owes a duty to disclose information to the other party. Such circumstances serve as exceptions to the general rule that “participants in a business transaction deal at arm's length; it has been said that an individual has no particular duty to disclose facts nor any particular right to rely on the statements of the party with whom he contracts at arm's length.” Annechino v. Worthy, 175 Wn.2d 630, 636, 290 P.3d 126 (2012) (quoting Liebergesell v. Evans, 93 Wn.2d 881, 889, 613 P.2d 1170 (1980)).
[Current as of February 2021.]
Westlaw. © 2022 Thomson Reuters. No Claim to Orig. U.S. Govt. Works.
| End of Document |