Identify whether the following statements could result in actionable fraud and why or why not
a. A statement by an art dealer to a potential buyer, "I think this painting is underpriced because the artist is now gaining national recognition.".
b. A vacuum cleaner salesperson's statement, "This machine is the best available for the cost.".
c. A city councilman's statement to a fellow councilman that, "If we vote for that action, the resulting consolidation will be illegal.".
a . This is a statement of opinion because it expresses the dealer's judgment as to value of the painting. Ordinarily a statement of opinion is not a basis for actionable fraud. Here, however, the statement is made by one with superior knowledge, so it could be the basis of actionable fraud if the buyer sustains loss by reasonable reliance on the statement. In close cases of determining fact versus opinion, it is a question for a jury.
b. This statement is merely "puffing" or sales talk and would not result in actionable fraud.
c. Historically, courts held that representations of law were statements of opinion rather than fact. Presently a statement of law may have the effect of a statement of either fact or opinion. If the statement is to the legal consequences of a set of facts, it is considered a statement of opinion and probably not actionable.
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