Contracts

What is 'constructive fraud' versus 'actual fraud' in Hawaii real estate and how do they differ?

AA. They are identical; the distinction only matters in criminal law
BB. Actual fraud involves intentional misrepresentation; constructive fraud involves breach of a duty (such as fiduciary duty) that produces a benefit at another's expense, without necessarily requiring intent to deceive✓ Correct
CC. Constructive fraud is a lesser violation than actual fraud and carries no civil liability
DD. Actual fraud requires physical harm; constructive fraud involves only financial harm

Explanation

Actual (intentional) fraud involves knowing or reckless misrepresentation to induce action. Constructive fraud involves a breach of duty (particularly fiduciary duty) that produces unjust advantage without requiring intent to deceive.

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