Unlike fraudulent deceit, negligent misrepresentation does not require the defendant act with knowing falsity or recklessly and without regard to the truth. Rather, the assertion must merely be made without reasonable grounds to believe it true.
To prevail in a claim for negligent misrepresentation, the plaintiff (i.e., the person bringing the lawsuit) must show:
- The defendant represented to the plaintiff that a fact was true;
- The defendant’s representation was not true;
- The defendant had no reasonable grounds for believing the representation was true when he/she made it;
- The defendant intended that the plaintiff rely on this representation;
- The plaintiff reasonably relied on the defendant’s representation;
- The plaintiff was harmed; &
- The plaintiff’s reliance on the defendant’s representation was a substantial factor in causing his/her/its harm.
Although punitive damages are not available under this theory, an injured plaintiff may still be entitled to full compensatory damages.