Which term best describes a statement that leads someone to enter into a contract but is not true?

The term that best describes a statement that leads someone to enter into a contract but is not true is misrepresentation. Misrepresentation occurs when one party provides false information that induces another party to enter into a contract. This can happen either intentionally, where the party knowingly presents false information, or unintentionally, where the party believes the statement is true but is actually not. Misrepresentation is significant in contract law because it can affect the validity of the contract and may entitle the injured party to seek remedies or damages.

In this context, negligence refers to a failure to take reasonable care, which typically does not directly relate to the formation of a contract. Inducement, while related to persuading someone to enter into a contract, does not specifically imply that the information provided was false. Coercion involves forcing someone to enter a contract against their will, which does not apply to the concept of a misleading statement leading to contract formation. Understanding misrepresentation is crucial for grasping the principles of contract law and the protections available to parties engaging in contractual agreements.