What legal concept encompasses hidden or undisclosed risks in a contract?

The legal concept that best encompasses hidden or undisclosed risks in a contract is active concealment. This refers to a situation where one party intentionally hides or omits important information about the contract from the other party. In essence, it involves actions taken to prevent the other party from discovering crucial aspects of the agreement that could influence their decision to enter into the contract or the terms they would accept.

Active concealment typically arises in scenarios where one party has superior knowledge or information that, if disclosed, would alter the understanding or risk profile of the agreement significantly. This concept is grounded in the principle of good faith and fair dealing, where parties are expected to disclose adverse information that could affect the other party's rights or obligations under the contract. Thus, it highlights the ethical and legal responsibilities that parties have in ensuring transparency in contractual relationships.

The other concepts mentioned, such as exorbitant interest rates, mere silence, and fraud, do not appropriately capture the notion of hidden risks specifically. Exorbitant interest rates relate more to the legality and fairness of financial terms than to the concealment of contract risks. Mere silence generally refers to the absence of communication rather than active steps to hide information, and fraud involves intentional deception, which, while related, is broader and includes