Which of the following is NOT a type of misrepresentation that can act as a contract defense?

Study for the CLEP Business Law Test. Engage with flashcards and multiple choice questions, each question has hints and explanations. Prepare effectively for your exam!

Reliance misrepresentation is not recognized as a distinct type of misrepresentation that can serve as a defense in contract law. The primary types of misrepresentation that are acknowledged include innocent misrepresentation, which occurs when a party believes their statement to be true, negligent misrepresentation, where a party fails to exercise reasonable care in ascertaining the truth of a statement, and fraudulent misrepresentation, which involves a knowingly false statement made with the intent to deceive another party.

In contract law, a successful claim of misrepresentation relies on proving that the misrepresentation influenced the decision to enter into the contract. Innocent, negligent, and fraudulent misrepresentations each have specific legal implications and remedies. However, reliance misrepresentation does not stand alone as a category; rather, it refers to the reliance that a party places on a misrepresentation. As such, it is not categorized as a type of misrepresentation itself, which solidifies why it is the correct answer in this case.

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