What is 'fraud' under contract law?

What is 'fraud' under contract law?

Michael Ehline (Attorney at Law) gives expert video advice on: What is a 'contract'?; What is a 'breach of contract'?; What is a 'breach of confidence' under contract law? and more...

Fraud doesn't normally involve a written agreement, although it can. Basically what fraud is, is a tort. It's an intentional tort wherein someone makes a promise or a statement to someone when they never intended to fulfill the promise or that they knew the statement was false at the time that they made it. Fraud is distinguishable from a breach of contract wherein when one person enters into a contract and the other person enters into the contract, they form an agreement which they both intend to keep. However, under a false promise theory, which is a subset of fraud, one may argue that when the other person entered into the contract he never intended to fulfill the contract. And because of that he is guilty of fraud. Or it could include a situation where someone has made a representation to you that was false and because that representation was false and you were damaged as a result of that false representation you can now sue that person for damages. One additional benefit of a fraud case to the plaintiff is that normally a fraud case arises to a clear and convincing evidence standard, which, if met, would often entitle the plaintiff to sue for punitive damages, not just for his compensatory damages.