In the world of business in particular, but in many other contexts as well, the word fraud can get thrown around in a lot of different contexts. For many people, fraud simply means behavior that is shady or deceitful, if not an outright lie.

The legal definition of fraud is a bit different in that it has a precise meaning which may vary only slightly depending on the circumstances. To summarize, though, a fraud is more than a mere exaggeration or a statement of opinion that turns out to be wrong. It has to be an actual misstatement of an important fact that persuades an innocent person in to signing an agreement, turning over property, or otherwise entering in to an unfair transaction.

Fraud can be both a sword and a shield in the legal world. For example, someone who has entered in to an agreement may plead fraud as a defense should the other party to the agreement try to sue for a breach of contract. The basic idea is that no one should have to follow through on a bad agreement when the deal was procured through dishonesty.

While the person claiming fraud in this circumstance cannot bury their head in the sand by ignoring a statement that is obviously not true, the person need not have to go through the trouble of investigating everything the other party to the agreement states. People entering contracts with each other have the right to take the other side at his or her word.

In another context, a person can also sue someone else for legal fraud and ask for triple the amount of money they owe as well as attorney fees. In this sort of situation, the term fraud is simply a type of stealing that is done through trickery.

Fraud can come up in business litigation and in fact does come up fairly often. If an allegation of fraud is in play as part of a contract dispute or other commercial litigation, then it might be best for a Tallahassee resident to discuss his or her options with an experienced business litigation attorney.