Am I contractually obligated to a company that misled consumers to believe they were another company?
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Am I contractually obligated to a company that misled consumers to believe they were another company?
A company contacted me daily on my business line stating they we another company. Once I started asking questions the rep that could not properly answer them re-directed me to the person that could pitch me and needless to say I signed up. This company is the worst of the worst. They are now being sued by the company they misrepresented them to be. If I cancel my credit card so they are no longer able to take payment from me, will I be sent to collections even if they do not have my SSN?
Asked on October 18, 2015 under General Practice, California
Answers:
SJZ, Member, New York Bar / FreeAdvice Contributing Attorney
Answered 8 years ago | Contributor
Fraud is a knowing lie or misrepresntation made about a material, or important fact, on which you reasonably relied. Mispresenting the identity of the company would be a material fact and fraud IF you reasonably relied on the misrepresentation. If the misrepresentation was cleared up at some point before you signed up with them--i.e. they told you the actual name of the company before you agreed to do business with them--then legally, this would not be fraud, since as long as you knew who they were before you signed up, you could not "rely" on the initial misrepresentation rather, the law would presume you voluntarily signed up knowing who they were. In this case, you'd be obligated under the agreement and if you refuse to pay, could be sued.
On the other hand, if the misrepresentation was not cleared up before you signed up, then this would seem to be fraud. If fraud, you would have legal grounds to rescind or "undo" the contract and escape any liabilities or obligations under it. If they tried to sue you for the money, you would raise fraud as a defense in court and possibly countersue for compensation for any costs or losses you incured.
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