Consumer Fraud Claims and the Duty to Investigate

If you have been flim-flammed by a fast-talking merchant of consumer goods who has misrepresented a material fact when negotiating a transaction, the wrongdoer cannot defend a resulting lawsuit by contending that you had a responsibility to investigate the truth of the statement. The basis of the rule is that when a representation is made, the consumer is entitled to rely upon the truth of the representation. Indeed, the rule is so well rooted that even if an investigation is made, the wrongdoer will not be absolved from liability unless the investigation actually disclosed facts sufficient to expose the falsity of the statement, or produce information that would require the consumer to conduct a further investigation. Thus, for example, if a car dealer sold you a stolen motor vehicle using fraudulent title papers that identified the dealership as the owner, this corrupt miscreant could not defend your consumer fraud claim with an argument that says that you had a responsibility to search the Motor Vehicle Commission records to determine the true owner.