Many business relationships are founded on a simple idea: trust. That is the same for businesses in our state. Unfortunately, there are times when the trust between the two sides of deal or contract can be ruptured. Fraud allegations can certainly cause this type of fracture in the relationship.

However, can allegations of fraud actually lead to business litigation? Quite simply, the answer is a resounding “yes.” But, such a claim can be difficult to prove, as it will likely entail efforts to show the intent of the allegedly fraudulent party, which can be hard to show.

The parties to a contract or business deal are presumed to be operating in good faith when they are negotiating the terms of the deal. One of the basic concepts of a contract, for example, is that all of the parties to the contract must be in agreement with the terms in the contract. Such agreement is shown by the signatures attesting to said agreement. But, what if the very core of the agreement is based on false statements or representations made by one side or the other? Such a claim of fraudulent misrepresentation could be the cause for business litigation.

The difficulty though, in such a claim, is that one of the elements that must be shown is that the party who made the false claim actually knew it was false at the time it was made. Furthermore, the false statement must have been made with the specific intent that the other side would rely upon the claim in making the deal or negotiating the terms of the contract at issue. These claims involve intent, which can make litigation contentious and uncertain. Businesses in Nevada that are facing these issues will need to understand their legal options.