In which circumstances may a party's silence be actionable as nondisclosure?

• A. Only when the party engages in active concealment.
• B. Only when the party owes a fiduciary duty to the other party.
• C. When the party engages in active concealment or when the party owes a fiduciary duty to the other party.
• D. A party's silence cannot give rise to a misrepresentation.

Answer: (C)

Silence qualifies as misrepresentation only when there is a duty to disclose material information. Two situations create that duty: active concealment, where a party intentionally hides facts, and a fiduciary relationship, where one party must disclose information in the interests of the other. In both cases, nondisclosure can be actionable because the party had an obligation to speak up. If there’s no concealment and no fiduciary duty, merely staying silent generally does not give rise to a misrepresentation claim.