Car Law A to Z: K is for Knowledge
In cases where a consumer purchases a vehicle or other item and alleges the seller failed to disclose certain damage to the item sold, knowledge of the defendant can be a key element. The law regarding fraud and failure to disclose material information typically focuses on two types of knowledge: actual knowledge and constructive knowledge.
Actual knowledge is when the defendant is actually informed of material information (ex: provided a document, verbal statement by a third party) while constructive knowledge is where the facts and circumstances support the inference that the defendant should have known the material information (ex: inspecting a used vehicle and seeing water damage and rust stains should give an experienced vehicle dealer an idea the vehicle has been flood damaged). The line between actual and constructive can become blurred depending on the facts. It can be quite difficult to prove actual knowledge unless you happen upon a proverbial smoking gun. On this you should not rely. Constructive knowledge is akin to circumstantial evidence and you can imagine the complexities involved in pursuing a claim that requires you to establish your case in this manner.
Fraud requires proof that the defendant had knowledge AND deceived you AND intended to deceive you. In a fraud claim you have the burden of establishing what knowledge the defendant had of the facts to which he deceived you. Since knowledge is such an important issue in many vehicle cases and it is one that is easily denied, you may need an experienced attorney to analyze the issues in your case and secure the testimony and evidence needed to obtain a favorable result in your case.