8 Mistake Flashcards
“The great peace”
Great Peace shipping v Tsalvaris Salvage
Agreement Mistake Case
A mistake prevents the agreement and makes the contract void ab initio.
Types of Mistake
- Mutual Mistake (Parties are at cross purpose) -> Contract void
- Common mistake) where both parties hold the same mistaken belief of the facts. -> Contract void
- Unilateral Mistake (where only one party to a contract is mistaken as to the terms or subject-matter contained in a contract) -> Contract not void
Caveat Emptor (let the buyer beware)
Caveat Venditor (let the seller beware).
Raffles v Wichelhaus
(Mutual Mistake to ship carrying goods case)
- the contract between the complainant and defendant was not enforceable.
- there was ambiguity in the ship was being referred to,
- as well as no agreement on the terms on the sale.
- There had been no consensus ad idem or meeting of the minds between the parties to form a binding contract.
- The objective test made it clear that a reasonable person would not have been able to identify with certainty what ship had been agreed on.
Scriven Bros v Hindley
(Auction mistake of the good)
Mutual mistake
Parties were never ad idem to the subject matter of the proposed sale
Tamplin v James
(Plan stated something different than the proposal of the property at sale)
-> Contract was unenforcable to specific performance since it was a mutual mistake
Smith v Hughes
(old and new oats case for the horses)
The action based on misrepresentation failed as you cannot have silence as a misrepresentation. The defendant had not mislead the claimant to believe they were old oats. The action based on mistake failed as the mistake was not as to the fundamental terms of the contract but only a mistake as to quality.
Phillips v Brooks
(Rogue entered jewelry shop and bought on credit, failed to pay)
The contract takes place with the person in front of you (when dealing face to face) therefore there will be a meeting of the minds and the contract is not void.
It is a unilateral mistake to creditworthyness rather than a mistake to identity
-> A contract where you deal face to face will probably not be void when there is a mistake to identity of the person
Cundy v Lindsay
(Contract by written correspondence)
-> Contract is void because there is a mistake to identity
(good faith = bona fide)
Shogun Finance v Hudson
Mistake as to identity
Hudson was required to return the car to Shogun.
Kings Norton Metal v Edridge Merret
(Company dealing with a fraudulent letterhead case)
-> Where there is a mistake in a written agreement to the identity but not a mistake with the identity of another person / company then there is a binding agreement!
(Case distinguished from Cundy v Lindsay)
Frederick Rose v William Junior
- Agreement reflected correctly what was agreed up on
- > Retification was refused by the court
Joscelyn v Nissen
(exchange contract between father and doughter case)
- Retification could be ordered as long as there was a common continuing intention (objectively ascertained)
Leaf v International Galleries
Leaf v International Galleries [1950] 2 KB 86
The claimant purchased a painting from the defendant. Both parties believed that the painting was by the artist Constable. In fact 5 years later the claimant discovered the painting was not a Constable. The claimant brought an action based both on misrepresentation and mistake.
The claim based on misrepresentation was successful however, since it was an innocent misrepresentation, the claimant had lost the right to rescind the contract through lapse of time. With innocent misrep the time starts to run from the date of the contract not the date of discovery.
The claim based on mistake was unsuccessful as the mistake related to the quality and did not render the subject matter something essentially different from that which it was believed to be. He believed he was buying a painting and he got a painting.
