Error Flashcards
What are the 5 categories that essential error traditionally falls under and what case are they endorsed in?
In Stewart v Kennedy (1890) the court endorses the following categories of essential error set out by Bell-
-Identity of the debtor
-Subject of the contract
-Price
-Quality of thing bargained for
-Nature of the contract
What are the 3 types of error?
-Error in expression
-Performance Error
-Consensual Error
What remedies are possible where there has been an error in expression?
Rectification governed by s.8+9 of the Law Reform Act 1985. Court will attempt to give effect to the common intention of the parties. Governed by the law of evidence.
What is the remedy for performance error?
Unjustified enrichment (for example in the case of mistaken payments etc.)
What are the three types of consensual error?
Mutual, common and unilateral error.
What is common error and the consequence of said error? Additionally what is the authority this?
Common error is present where both parties are in error as to the same aspect of the alleged contract and have the same mistaken view. It renders a contract void (Hamilton v Western Bank of Scotland).
What is mutual error and the consequences of said error? What are the two cases that are authority for the consequence?
Mutual error is where both parties have differing views as to the effect of part of a contract. It can be looked at as a simple case of dissensus (such as in Muirhead & Turnbull v Dickson) or as a case where the parties are objectively in agreement but are in error as to each other’s interpretation of the meaning of an essential aspect of the contract (Raffles v Wichelhaus), either way it leads to a void contract.
How was error redefined in Stewart v Kennedy (1890?) and Menzies.
It was made clear that the court would take an objective approach to error; the erroneous belief of one party could not render a written contract void. As such it was decided that error would only be actionable where it was induced by the representations of the other party to the contract, whether fraudulent or not.
Menzies has the effect of making error only actionable in cases of misrepresentation though there are exceptions to this.
Where there is an induced unilateral error what is the consequence of this and what is the exception to this?
Normally an induced unilateral error is governed by the law of misrepresentation (Menzies v Menzies). However McBryde argues that where there is an induced error but the error fits within one of the essential error categories as set out by Bell and endorsed in Stewart v Kennedy the contract will be governed by the law of error and is void. Both Morrisson v Robertson (Scottish) and Shogun Finance Ltd v Hudson (English) seem to be authority for this in the case of essential error as to identity.
When will uninduced unilateral error be operative?
Although Stewart v Kennedy and Menzies suggest that error will only be actionable where it is induced, McBryde believes there is an exception. This exception applies where there is “error+” meaning there is error plus the following circumstances-
-Gratuitous contract due to presumption against donation (Hunter v Bradford Property Trust is authority for this).
-Onerous contract where other party knew about the mistake, did not disclose the error and acted in bad faith (Steuart’s Trs v Hart, 1875). This is disputed, as there substantial case law from the Outer House that suggests that as per Stewart v Kennedy the error must be induced. However Angus v Bryden 1992 reiterates that Steuart’s Trs is still good law and that uninduced error is operable where it is known to and taken advantage by the other party. Likewise Wills v Strategic Procurement Ltd reiterates that an induced error going to the root of the contract (not a motive for entering into the contract) can render a contract voidable in the circumstances set out by Steuart’s Trustee’s.
