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Susan was looking to buy a restaurant business. After looking at several different areas, she decided to contact a real estate agent who specialised in selling businesses properties.
Tom, the real estate agent, told Susan to buy a Chinese restaurant in Chinatown. Susan expressed her concern to Tom about the large number of Chinese restaurants within the area and its potential negative negative impact on profits.Tom told Susan not to worry about that, because, in his view, such a business will be ‘a gold mine’ because of many tourists who visit Chinatown.
Acting on Tom’s, advice, Susan went ahead and bought a Chinese restaurant in Chinatown. Susan borrowed a lot of money for this business investment.Within 6 months of trading, Susan had to shut down the restaurant because tourist numbers were very low and there was lots of competition from the other Chinese restaurants in the area, resulting in heavy losses in her business .
• Advise Susan whether she can sue Tom for his statements about the business?
• Will Susan succeed? Explain your answer with reference to relevant legal principles and case law.
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