Concealment

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concealment

n. fraudulent failure to reveal information which someone knows and is aware that in good faith he/she should communicate to another. Examples include failure to disclose defects in goods sold (the horse has been sick, the car has been in an accident), leaving out significant liabilities in a credit application, or omitting assets from a bankruptcy schedule to keep them from being available for distribution to creditors. Such concealment at minimum can be a cause for rescission (cancellation) of a contract by the misled party or a civil lawsuit for fraud. (See: fraud)

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CONCEALMENT, contracts. The unlawful suppression of any fact or circumstance, by one of the parties to a contract, from the other, which in justice ought to be made known. 1 Bro. Ch. R. 420; 1 Fonbl. Eq. B. 1, c. 3, Sec. 4, note (n); 1 Story, Eq. Jur. Sec. 207.
     2. Fraud occurs when one person substantially misrepresents or conceals a material fact peculiarly within his own knowledge, in consequence of which a delusion exists; or uses a device naturally calculated to lull the suspicions of a careful man, and induce him to forego inquiry into a matter upon which the other party has information, although such information be not exclusively within his reach. 2 Bl. Com. 451; 3 Id. 166; Sugd. Vend. 1 to 10; 1 Com. Contr. 38; 3 B. & C. 623; 5 D. & R. 490; 2 Wheat. 183; 11 Id. 59; 1 Pet. Sup. C. R. 15, 16. The party is not bound, however, to disclose patent defects. Sugd. Vend. 2.
     3. A distinction has been made between the concealment of latent defects in real and personal property. For example, the concealment by an agent that a nuisance existed in connexion with a house the owner had to hire, did not render the lease void. 6 IV. & M. 358. 1 Smith, 400. The rule with regard to personalty is different. 3 Camp. 508; 3 T. R. 759.
     4. In insurances, where fairness is so essential to, the contract, a concealment which is only the effect of accident, negligence, inadvertence, or mistake, if material, is equally fatal to the contract as if it were intentional and fraudulent. 1 Bl. R. 594; 3 Burr. 1909. The insured is required to disclose all the circumstances within his own knowledge only, which increase the risk. He is not, however, bound to disclose general circumstances which apply to all policies of a particular description, notwithstanding they may greatly increase the risk. Under this rule, it has been decided that a policy is void, which was obtained by the concealment by the assured of the fact that he had heard that a vessel like his was taken. 2 P. Wms. 170. And in a case where the assured had information of "a violent storm" about eleven hours after his vessel had sailed, and had stated only that "there had been blowing weather and severe storms on the coast after the vessel had sailed" but without any reference to the particular storm it was decided that this was a concealment, which vitiated the policy. 2 Caines R. 57. Vide 1 Marsh. Ins: 468; Park, Ins. 276; 14 East, R. 494; 1 John. R. 522; 2 Cowen, 56; 1 Caines, 276; 3 Wash. C. C. Rep. 138; 2 Gallis. 353; 12 John. 128.
     5. Fraudulent concealment avoids the contract. See, generally, Verpl. on Contr. passim; Bouv. Inst. Index, h.t.; Marsh. Ins. B. 1, c. 9; 1 Bell's Com. B. 2, pt. 3, c. 15 s. 3, Sec. 1; 1 M. & S. 517; 2 Marsh. R. 336.

A Law Dictionary, Adapted to the Constitution and Laws of the United States. By John Bouvier. Published 1856.
References in classic literature ?
"And once again, if the thought of leaving a bicycle concealed outside had occurred to you, would it really have seemed worth doing when the dullest detective would naturally say this is an obvious blind, as the bicycle is the first thing which the fugitive needed in order to make his escape."
Yesterday morning he set off for this place on his bicycle, with his gun concealed in his overcoat.
Anselmo, hidden behind some tapestries where he had concealed himself, beheld and was amazed at all, and already felt that what he had seen and heard was a sufficient answer to even greater suspicions; and he would have been now well pleased if the proof afforded by Lothario's coming were dispensed with, as he feared some sudden mishap; but as he was on the point of showing himself and coming forth to embrace and undeceive his wife he paused as he saw Leonela returning, leading Lothario.
The deception was carried on for some time, until at the end of a few months Fortune turned her wheel and the guilt which had been until then so skilfully concealed was published abroad, and Anselmo paid with his life the penalty of his ill-advised curiosity.
After a vociferous consultation, which was, at times, deafened by bursts of savage joy, they again separated, filling the air with the name of a foe, whose body, Heywood could collect from their expressions, they hoped to find concealed in some crevice of the island.
There was a feeling of dread, neither plainly confessed nor carefully concealed, which caused each to shift the responsibility upon another, till at length it was found expedient to send a deputation of the church, in order to deal with Mr.
As his plighted wife, it should be her privilege to know what the black veil concealed. At the minister's first visit, therefore, she entered upon the subject with a direct simplicity, which made the task easier both for him and her.
'Oh mother,' says I, 'if you can do so, you will engage me to you for ever.' 'Well,' says she, 'are you willing to be a some small annual expense, more than what we usually give to the people we contract with?' 'Ay,' says I, 'with all my heart, provided I may be concealed.' 'As to that,' says the governess,
She did not think that Julia would be able to penetrate his disguise, as he had declared his intentions so to conceal himself, by paint and artifice, as to be able to escape detection.
The survivors then become extremely shy, and can scarcely be "brought to medicine," to use the trapper's phrase for "taking the bait." In such case, the trapper gives up the use of the bait, and conceals his traps in the usual paths and crossing places of the household.
The captain, illumining with trembling pine-torch this frightful carnage, of which he in vain sought the cause, drew back towards the pillar behind which Porthos was concealed. Then a gigantic hand issued from the shade, and fastened on the throat of the captain, who uttered a stifle rattle; his stretched-out arms beating the air, the torch fell and was extinguished in blood.
As she leaned back on the sofa on which she was sitting, Madame de Belliere covered the paper with the thick folds of her large silk dress, and so concealed it.