23. A licensee represents the seller of a commercial property. The licensee tells the buyer a new highway exit ramp will be built within six months to give access to the property, although the licensee knows that is only one of several possibilities being considered by local planners. The exit ramp is subsequently located elsewhere. Could the licensee be liable to the buyer for the statement about the ramp?
Answer: D
Yes, the statement was a material misrepresentation.
The licensee could be liable to the buyer for the statement regarding the new highway exit ramp since it constitutes a material misrepresentation. The licensee knowingly provided false information about a significant factor that could influence the buyer's decision, which is a breach of duty.
A) No, the statement was the licensee's opinion.
This option is incorrect because the licensee presented the statement as a fact rather than an opinion. An opinion would not carry the same weight as a definitive claim about the construction of an exit ramp, which the buyer could reasonably rely upon.
B) No, the licensee cannot be held liable for the planners' decision.
This option is also incorrect. The licensee's liability stems from providing misleading information, not the outcome of the planners' decision. By asserting that the exit ramp would be built, the licensee misrepresented the situation irrespective of the planners' final choice.
C) Yes, the statement was unjustifiable puffing.
This choice is incorrect because "unjustifiable puffing" typically refers to exaggerated claims that are subjective and not factual. In this case, the licensee presented a specific statement about the ramp's construction, which is a factual misrepresentation rather than mere puffery.
D) Yes, the statement was a material misrepresentation.
This option is correct as it accurately identifies the nature of the licensee's statement. By claiming that the ramp would be built when it was only one of several possibilities, the licensee misled the buyer, which is a clear case of material misrepresentation.
Conclusion
The correct answer is D because the licensee's statement about the highway exit ramp misled the buyer regarding a material fact that could significantly influence their purchasing decision. Options A, B, and C fail to recognize the implications of the licensee's false assertion and its potential impact on the buyer's trust and decision-making process.