Under California law, contracts that are entered into because of the fraud of one of the parties are different from simple breaches of contract, and can result in punitive damages and other remedies beyond those that arise from a simple breach.

Actual fraud involves the intent to create a contract by deception, while constructive fraud involves misstatements without fraudulent intent.

Fraud itself is defined by California statute as consisting of several acts, including asserting a falsehood as a fact, asserting as fact something that the person has no reason to believe is true, making a promise with no intention to deliver on it, failing to disclose a material fact, or any other act intended to deceive. The aggrieved party must have reasonably relied upon the fraud as a basis for entering into the agreement in the first place. There must also be damages for the fraudulent act to be the basis of a lawsuit.

The remedies to the damaged party in a fraud action are generally designed to reflect the type and severity of the fraud, on a case-by-case basis.

Not all breaches of contract or failures to live up to a promise are fraudulent. If your case can be characterized as a fraud case, however, the damages and other remedies available can be considerably more than with just a simple breach of contract.