relate to the future may be regarded as a statement of fact on the basis that the airline must know there will be circumstances in which more passengers may turn up for a flight than there are seats available. In this regard, it has been said that the state of a man’s mind is as much a fact as the state of his digestion!

In Edgington v Fitzmaurice,29 the directors of a company issued a prospectus inviting investment in the company in return for the issue of secured debentures. The prospectus falsely stated that the money invested would be used to complete alterations to buildings owned by the company and to generally expand the company’s business activities. In fact, the money lent by the plaintiff was used to meet debts owed by the company – a purpose the directors had in mind but did not state in the prospectus. The Court of Appeal dismissed an appeal against an order for rescission of the contract on the ground that there had been a fraudulent misrepresentation:

Edgington v Fitzmaurice (1885) 29 Ch D 459, CA, p 481 Bowen LJ: This is an action for deceit, in which the plaintiff complains that he was induced to take certain debentures by the misrepresentations of the defendants and that he sustained damage thereby. The loss which the plaintiff sustained is not disputed. In order to sustain his action, he must first prove that there was a statement as to facts which was false and, secondly, that it was false to the knowledge of the defendants or that they made it not caring whether it was true or false. For it is immaterial whether they made the statement knowing it to be untrue, or recklessly, without caring whether it was true or not, because to make a statement recklessly for the purpose of influencing another person is dishonest. It is also clear that it is wholly immaterial with what object the lie is told. That is laid down in Lord Blackburn’s judgment in Smith v Chadwick, but it is material that the defendant should intend that it should be relied on by the person to whom he makes it. But, lastly, when you have proved that the statement was false, you must further shew that the plaintiff has acted upon it and has sustained damage by so doing: you must shew that the statement was either the sole cause of the plaintiff’s act, or materially contributed to his so acting. So the law is laid down in Clarke v Dickson, and that is the law which we have now to apply.