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(b) That's right. When B says "Well, it looks like it's never had a scratch" and A replies "Yes, you won't find a scratch anywhere" without mentioning the accident and repairs, A is misrepresenting the facts. He knows that the car has in fact been damaged and repaired and he makes this statement knowing it is untrue, and with the intent of misleading B. Intentionally leading B into error is deceit, and creates liability in tort law for which damages can be claimed.

Furthermore, when a transaction is entered into because of deceit, it is voidable and can be set aside at the request of the party who was deceived.

It should be noted that, because a representation does not become a term of the contract, B has no action against A for breach of contract, even if A's statement about the scratch is untrue.

Derry v Peek (1889) 14 App Cas 337.