True or False: With negligent or fraudulent misrepresentation, a plaintiff may terminate the contract and sue for damages.

In cases of negligent or fraudulent misrepresentation, the plaintiff has the legal right to both terminate the contract and seek damages. Misrepresentation occurs when false statements are made that induce the other party to enter into a contract.

In the case of negligent misrepresentation, there is a failure to ensure the accuracy of the information provided, leading to a breach of the duty of care owed to the other party. With fraudulent misrepresentation, the misrepresenting party intentionally deceives the other party with false information.

Under these circumstances, the misled party may rescind the contract because the foundation of their agreement was based on falsehoods. Additionally, they can claim damages to recover losses incurred due to relying on the misleading statements. This primary principle in contract law protects parties from being bound to agreements based on misrepresentations, thereby affirming the correctness of the response to the question.