Consumer Fraud Act: Deceptive Practices

The New Jersey Consumer Fraud Act is very powerful legislation. The Consumer Fraud Act as written prohibits deceptive practices in the selling of goods and services. The Consumer Fraud Act jury instructions specifically define deceptive practices as the following:

An “unconscionable commercial practice” is an activity in the public marketplace which is basically unfair or unjust and/or which materially departs from standards of good faith, honesty in fact and fair dealing. To find a commercial practice to be unconscionable, there should be factual dishonesty and a lack of fair dealing

There is a very good case in New Jersey to illustrate a deceptive practice.

In Herner, the Superior Court, Appellate Division, held that inspection company engaged in an unconscionable commercial practice in violation of the statute by failing to provide purchasers an inspection and report forthrightly disclosing certain physical conditions of house, and by failing to disclose that real estate agent was company’s customer in fact and that company’s marketing philosophy was to stress both positive and negative aspects of a house so that consumer would have little basis for calling off sale or renegotiating price.

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