The cause of action of negligent misrepresentation lies when: (1) defendant had a duty to use reasonable care in giving information; (2) defendant supplied false information; (3) upon which the plaintiff relied; (4) to its damages. The two essential elements are a duty on the part of the defendant to disclose and reliance on the part of the plaintiff. The duty to disclose correct information arises from a closer degree of trust and reliance than in the ordinary business relationship. Accordingly, a claim for negligent misrepresentation can only stand when there is a special relationship of trust and confidence which creates a duty for one party to impart correct information to another. When the claim is failure to disclose information, the elements of the cause of action are the same. To constitute fraud by non-disclosure or suppression there must be a failure to disclose known facts and a request or an occasion or circumstances which impose a duty to speak. Mere silence is not actionable in a transaction in which the parties deal at arms length unless the circumstances or the existence of a confidential relationship give rise to a duty to speak.
Plaintiff tenant rented space in a mall. For many years, the landlord spent enormous amounts of its own money to make the mall a viable business venture. From 1992 to 1998, defendant contributed many times more to the promotional fund than it was obligated to do under the lease. Its efforts at promotion did not increase traffic, obtain new tenants, or acquire tenant replacements. Defendant landlord stopped promoting the mall and decided to sell it. The tenant sued the landlord for breach of the implied covenant of good faith and fair dealing, negligent misrepresentation, and violation of the Connecticut Unfair Trade Practices Act. Judgment was entered in favor of the landlord.
Did plaintiff prove cause of action of negligent misrepresentation by defendant?
The tenant did not prove the landlord's negligent misrepresentation, as the landlord did not have to tell the tenant about its decision to sell the mall, and the tenant had actual knowledge of the information the landlord allegedly withheld and still sought to continue its tenancy. Under the circumstances of this case there was no fiduciary duty, nor were the parties involved in any other relationship that would require defendant to disclose to the plaintiff information about its internal decision to sell the mall or to disclose its plans to promote the Civic Center it. Moreover, the plaintiff has failed to prove that it relied upon defendant's plan to cease actively promoting the mall.