MISTAKE Flashcards
Define Mistake:
Defence to the proper formation of a contract, resulting contract is NOT what one or both parties expected (typically mistaken facts, NOT MISTAKES ABT LAW)
If There was a Mistake About Terms.. What can be Done:
-If a real mistake was made by both sides, courts may say the contract is void.
-A void contract is treated as if it never existed.
-Both parties must return what they received.
What happens when a contract is voided?
-Act like contract never happened
-Any exchanged money or goods must be returned
3 Types of Mistakes About Terms
1. A word is used by accident
-Sometimes people say the wrong thing by accident
-Court asks “how would a reasonable person interpret the word”
-If a mistake happens when writing down the contract, court can fix this
-Called ratification
-Both people think a word means something different
-What would a reasonable person think?
-If they never agreed on the same thing (not “ad idem”), there was no real contract
Expand Mistakes About Assumptions:
-Sometimes, people make contracts assuming something is true — but it’s not, even at the time they sign it.
-If the thing being sold doesn’t exist anymore (and nobody knew), the contract is void.
Three Approaches Courts Use for Assumptions:
- Try to make the contract work by interpreting what the parties meant.
- Ask: Who can better handle the loss?
- Would it be unfair to enforce the contract?
Expand on Mistakes and Third Parties. What if someone who bought something later down the line is affected by the original mistake?
What are options to resolve this?
1. Void: first contract never happened (btw A and B) → protects A, and C must return item
Explain Non Est Factum, who does it apply to?
Translates to: “I didn’t mean to sign this contract.”
Only works in very rare cases, like if someone is:
-Blind
-Illiterate
-Mentally impaired
