Explain civil liability for negligent misstatement and when it arises.

• A. Occurs when providing professional advice negligently causing economic loss to a client; requires reliance, duty of care, breach, causation, and damages.
• B. Only applies to criminal cases.
• C. Arises whenever any statement causes any loss.
• D. Requires intent to mislead.

Answer: (A)

Civil liability for negligent misstatement arises when a professional gives advice or a statement that is negligently incorrect and someone who relies on that advice suffers economic loss. The crucial idea is that there must be a duty of care in giving the advice, the advice must fall below the standard expected of a reasonable professional (a breach), the claimant must have reasonably relied on the statement, and that reliance must cause financial loss, resulting in damages.

This is why the described scenario is the best fit: it centers on professional advice causing economic loss and includes the essential elements—reliance, duty of care, breach, causation, and damages. The other options don’t fit because: one is about criminal cases, which is a different branch of law; another is too broad, implying liability for any statement no matter the context; and the last requires intent to mislead, which is not required for negligence.