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constructive fraud

   Also found in: Dictionary/thesaurus, Legal 0.03 sec.
constructive fraud

A breach of some duty that results in a tendency to deceive others,with no requirement of a showing of intention to deceive or moral wrongdoing.A broker may be charged with constructive fraud if that person had a duty to disclose a known dangerous defect and failed to do so.



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A North Carolina court of appeals ruled that shareholders of a corporation could maintain a constructive fraud action against an accounting firm.
The federal court also found that Sassoon could go forward with a claim of constructive fraud against P&G, which had over $43 billion in global sales in the fiscal year ending June 30, 2003.
The federal court also found that Sassoon could go forward with a claim of constructive fraud against the Cincinnati-based company with more than $43 billion in global sales in the fiscal year ending June 30, 2003.
 
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