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CHAPTER 3

THE POLICY DOCUMENTS

3.7.5Failure to Tell the Whole Truth
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Both First National and Irish Life are guilty of Negligent Misrepresentation in that they failed to make full disclosure of all material facts known to them which might be considered likely to affect the decision of my wife and I to enter into an Endowment Mortgage Contract with them. They failed to tell the WHOLE TRUTH.


Their silence on the following matters constitutes a Misrepresentation:

(a)

They failed to disclose the fact that the Policy could not be encashed until after it had been in force for two complete years.

(b)

They failed to disclose the fact that during the first year of the policy there is no investment and that the meaning of ‘during the first year of the policy there is no investment’ is that they actually keep all the first year’s payments themselves, i.e. the first year’s payments are NEVER invested.

In the case of First National, their duty to disclose stems from their duty of care following from their fiduciary position.


In the case of Irish Life, their duty to disclose stems both from their duty of care arising from the existence of a special relationship transferring through their tied agent, First National, and from the Uberimma Fides (Utmost Good Faith) nature of the contract. Irish Life, as principal, are liable for the representations and non-disclosures of their tied agent, First National.


(See Section 2.3.4: The Duty to Disclose and Silence as a Misrepresentation, and Section 2.7: The Effect of Agency. See also Section 2.8.1: The Right to Revoke the Contract, and Section 2.8.3: The Measure of Damages as a result of a successful Action based on the Common Law liability under Negligent Misrepresentation.)


Note!
Imprint in your mind the important distinction between the duty of disclosure as a consequence of a duty of care and the duty of disclosure as a consequence of the Uberimma Fides nature of a contract! A breach of the former constitutes a tort, i.e. it gives rise to a liability for damages.


An Act of Deliberate Omission
(see Section 3.5)

As we have seen in Conlon v Simms in Section 2.3.4 (a), it is a whole other matter when the breach of a duty of disclosure is deliberate.

In such cases "the non-disclosure assumes the character of fraudulent concealment, or amounts to fraudulent misrepresentation, or is otherwise founded on, or characterised and accompanied by, Fraud".

And, as will become evident as we progress through our interrogation of the conduct of Irish Life and First National, everything is deliberate: disclosures and non-disclosures.

 

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