Contract 6 - Mistake Flashcards
What is the effect of mistake?
Prevents a contract from taking legal effect - contract void from outset
What are the 3 categories of mistake?
- Common Mistake: both parties suffering from same mistake 😳😳
- Mutual Mistake: both parties mistaken but about different things 😳/😳
- Unilateral Mistake: 1 party mistaken and other knows 😳😏
What are the requirements for common mistake?
😳😳
- Must be sufficiently fundamental to affect validity of contract 🌳
Will not operate where:
- one party is at fault; 😈
- contract makes provision for this issue 📝
(quality of goods does not void contract ⭐️📦 e.g. painting)
What is the test for mutual mistake?
😳/😳
Objective 👀: What a reasonable 3rd party would believe the agreement to be, based on words and conduct of themselves. Only if a third party would think there was no discernible meaning will mistake apply .
What are the rules regarding unilateral mistake?
😳😏
where only one party has made a mistake and the other party knows or is deemed to know of the mistake - e.g. buying 30g of something for £1 rather than 30kg for £1
What are the rules regarding unilateral mistake of identity?
😳😏
- misrepresentation - Where seller intended to deal with person in front of them & that’s what happened, NOT void for mistake, voidable for misrepresentation 😳😐
- Mistake - Where seller can show that identity was of vital importance = VOID for mistake 😳🥸
Easier to show where not face to face as the mistake is then who they are contracting with rather than a person they are dealing with.
What happens where a fraudulent buyer sells goods onto a 3rd party?
- misrepresentation- Where fraudster has voidable title, & title has not avoided at time of sale, 3rd party acquires good title where bought in good faith so C can’t take goods back 😳😐😇=😁
- mistake = void & ineffective from outset so 3rd party must return goods even if bought in good faith😳🥸😇=😭
What is presumed where parties contract face to face?
Seller intended to deal with person in front of them - difficult to rebut
