A is corrent. Misrepresentation may involve an innocent misstatement made in good faith (i.e., there is no scienter or intent to mislead). In order to rescind a contract because of a misrepresentation, the rescinding party must prove that there was a misrepresentation of a material fact, that there was reliance on this fact, and that there was injury as a result.
B is incorrect. Reformation is a remedy used to correct a mutual or unilateral mistake. Reformation allows for the contract to be rewritten so that it is in agreement with the original intentions of the contract. In this case, the party is seeking rescission; he wants to cancel the contract and return both parties to their precontract positions.
C is incorrect. Constructive fraud requires reckless disregard for the truth (i.e., more than unintentional conduct).
D is incorrect. Actual fraud requires scienter or intent to mislead. In this case, the materially false misstatement was unintentional.
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