Statute Details
- Title: Misrepresentation Act 1967
- Full Title: An Act to amend the law relating to innocent misrepresentations
- Act Code: MA1967
- Legislative status (as provided): Current version as at 27 Mar 2026
- Revised editions noted in metadata: 1994 RevEd; 2020 RevEd (in force 31 Dec 2021)
- Long title (substantive themes): (1) Removal of certain bars to rescission for innocent misrepresentation; (2) Damages for misrepresentation; (3) Avoidance of exclusion clauses; (4) Saving for past transactions
- Key provisions (from extract): Sections 1–4; Section 5 (short title)
- Related legislation (from metadata): Civil Law Act 1909; Unfair Contract Terms Act 1977
What Is This Legislation About?
The Misrepresentation Act 1967 (“MA 1967”) is a Singapore statute that modernises the legal consequences of misrepresentations made during contracting. In particular, it addresses the position where a misrepresentation is “innocent”—that is, made without fraud. Under the general law of contract, a party induced to enter a contract by a misrepresentation may seek rescission (setting the contract aside). However, historically, certain circumstances could operate as “bars” to rescission even where the misrepresentation was not fraudulent. The MA 1967 removes some of those bars and provides additional remedies.
At the same time, the Act recognises that rescission is not always the most appropriate remedy. It therefore introduces a statutory framework allowing damages in misrepresentation cases, and it gives courts or arbitrators discretion to award damages in lieu of rescission where equitable. Finally, the Act limits the ability of contracting parties to contract out of liability for misrepresentation by rendering certain exclusion or restriction clauses ineffective unless they meet a reasonableness standard.
Practically, MA 1967 is most relevant in disputes about pre-contract statements—advertisements, sales pitches, representations in negotiations, disclosure documents, and other factual assertions that induce a party to sign. It is also central to litigation strategy because it affects both (i) whether rescission remains available and (ii) whether damages can be pursued even where fraud cannot be proved.
What Are the Key Provisions?
Section 1: Removal of certain bars to rescission for innocent misrepresentation. Section 1 targets a classic problem: even if a misrepresentation was innocent (not fraudulent), rescission could be denied where the contract had been “locked in” by subsequent events. The provision states that where a person enters into a contract after a misrepresentation has been made to him, and either (a) the misrepresentation becomes a term of the contract, or (b) the contract has been performed (or both), then—if the person would otherwise be entitled to rescind without alleging fraud—he shall be entitled to rescind notwithstanding those matters. In plain terms, the Act prevents the other party from defeating rescission merely by pointing to contractual incorporation of the statement or completion/performance of the contract.
For practitioners, Section 1 is significant because it clarifies that “innocent misrepresentation” does not lose its remedial force simply because the contract has progressed. However, the entitlement is still “subject to the provisions of this Act,” meaning other statutory limitations and the general equitable principles governing rescission may still matter. The section also frames the entitlement by reference to what would have been available “without alleging fraud.” This is a litigation-relevant drafting choice: it encourages parties to plead misrepresentation without needing to prove fraud, while still preserving rescission where otherwise available.
Section 2: Damages for misrepresentation. Section 2 is the Act’s remedial centrepiece. Subsection (1) establishes a damages regime for innocent misrepresentation. It provides that where a person enters into a contract after a misrepresentation has been made by another party, and as a result he suffers loss, then the representor is liable in damages as if the misrepresentation had been made fraudulently—unless the representor proves that he had reasonable grounds to believe, and did believe, up to the time the contract was made, that the facts represented were true. This effectively creates a statutory presumption of liability for damages in misrepresentation cases, shifting the evidential burden to the representor to show honest belief on reasonable grounds.
Subsection (2) addresses the relationship between rescission and damages. Where a person would be entitled to rescind for an innocent misrepresentation, and in proceedings arising out of the contract it is claimed that the contract ought to be or has been rescinded, the court or arbitrator may declare the contract subsisting and award damages in lieu of rescission if it considers it equitable. The court’s discretion is expressly guided by (i) the nature of the misrepresentation, (ii) the loss that would be caused if the contract were upheld, and (iii) the loss that rescission would cause to the other party. This is a balancing exercise: the remedy is not automatic, and the court can choose to keep the contract alive where rescission would be disproportionately harmful.
Subsection (3) clarifies that damages under subsection (2) can be awarded even if the representor would not be liable under subsection (1). But where the representor is liable under subsection (1), any award under subsection (2) is taken into account when assessing liability under subsection (1). This prevents double counting and ensures coherent assessment of damages across the statutory pathways.
Section 3: Avoidance of provision excluding liability for misrepresentation. Section 3 limits contractual attempts to exclude or restrict misrepresentation liability. If a contract contains a term that would exclude or restrict (a) any liability a party may be subject to by reason of misrepresentation made before the contract was made, or (b) any remedy available to another party by reason of such misrepresentation, then the term is of no effect except to the extent it satisfies the reasonableness requirement stated in section 11(1) of the Unfair Contract Terms Act 1977. Importantly, it is for the party claiming that the term satisfies reasonableness to show that it does.
This provision is crucial in commercial practice because exclusion clauses are common in sale and service contracts, especially where parties seek to limit reliance on pre-contract statements. Section 3 does not automatically strike out all exclusion clauses; it subjects them to a reasonableness test. But it shifts the burden to the party relying on the clause, increasing the risk that boilerplate “no reliance” or “no liability for statements” terms will be ineffective if they cannot be justified as reasonable in the circumstances.
Section 4: Saving for past transactions. Section 4 provides a temporal limitation. Nothing in the Act applies to misrepresentations or contracts of sale made before 12 November 1993, except insofar as it was applicable by virtue of section 5 of the Civil Law Act 1909 in force before that date. This is a standard “saving” clause to avoid retroactive effect. For lawyers, it matters when assessing limitation periods, transitional disputes, and the applicable legal regime for older transactions.
Section 5: Short title. Section 5 simply provides the citation: the Misrepresentation Act 1967.
How Is This Legislation Structured?
MA 1967 is a short statute structured around four substantive provisions and a short title. The structure is remedial and sequential:
Section 1 addresses rescission availability by removing certain bars for innocent misrepresentation. Section 2 then provides a damages framework, including both direct damages liability (with a belief-based defence) and the court’s discretion to award damages in lieu of rescission. Section 3 deals with contractual exclusion/restriction clauses, aligning their effectiveness with the Unfair Contract Terms Act 1977 reasonableness standard. Section 4 contains the saving for pre-12 November 1993 transactions. Section 5 is administrative (short title).
Who Does This Legislation Apply To?
MA 1967 applies to parties to contracts in Singapore where one party has made a misrepresentation to another party that induced the latter to enter into the contract. The Act is not limited to any particular industry or type of contract; it is triggered by the presence of (i) a misrepresentation, (ii) entry into a contract after the misrepresentation, and (iii) loss (for damages) or entitlement to rescind (for rescission-related relief).
In practice, the Act is most commonly invoked in consumer and commercial disputes involving sales and negotiations, including property transactions, equipment sales, and agreements where pre-contract statements are alleged to be inaccurate. The statutory damages regime in Section 2(1) is particularly relevant where the claimant cannot prove fraud but can show that a statement was untrue and induced entry into the contract. Section 3 applies to contractual terms that attempt to exclude or restrict liability or remedies for pre-contract misrepresentations; thus, it affects both consumer-facing and business-to-business contracting where standard terms are used.
Why Is This Legislation Important?
MA 1967 is important because it shifts the balance in misrepresentation litigation away from proving fraud. Under the common law, fraud typically unlocks rescission and damages. The Act ensures that innocent misrepresentation is not a “remedy-light” category. Section 2(1) in particular creates a statutory liability for damages that mirrors fraudulent misrepresentation liability, subject to a representor’s defence of reasonable grounds and genuine belief. This makes the evidential contest focus on what the representor knew and believed at the time of contracting, rather than on intent to deceive.
The Act also improves remedial flexibility. Section 1 strengthens the claimant’s ability to rescind even where the misrepresentation has become a contractual term or where the contract has been performed. Meanwhile, Section 2(2) gives the court or arbitrator discretion to preserve the contract and award damages instead of rescission where equitable. This is valuable in complex commercial settings where unwinding the contract may be impractical or disproportionately damaging.
Finally, Section 3 is a key risk-management provision for contracting parties. It undermines the effectiveness of exclusion clauses that attempt to immunise a party from liability for pre-contract misrepresentations. For practitioners drafting contracts, the message is clear: reliance on “no liability for statements” clauses may be insufficient unless the clause can satisfy the Unfair Contract Terms Act 1977 reasonableness test. For litigators, Section 3 provides a powerful statutory basis to challenge exclusion terms and to keep misrepresentation remedies available.
Related Legislation
- Civil Law Act 1909 (notably section 5 as referenced for the saving provision)
- Unfair Contract Terms Act 1977 (section 11(1) reasonableness requirement referenced in Section 3 of MA 1967)
Source Documents
This article provides an overview of the Misrepresentation Act 1967 for legal research and educational purposes. It does not constitute legal advice. Readers should consult the official text for authoritative provisions.