Mistake

Question 1

Tamplin v James

Answer 1

Fact:
 Def was a bidder (invitation to treat) for the sale of a property and he thought that the
property included the surrounding garden.
 However, it was clearly stated in the particulars of the sale that the garden was not included
but Def had not read them.
 Def was then the highest bidder and once he knew the property did not include the garden,
he did not want to continue with the purchase and Clm sued for breach.

Held:
 The Def had made a binding contract with the Clm who had accepted his highest bid at the
auction.
 The fact that Def made a careless mistake about what he was buying was his own fault and
should not affect the validity of the contract
 The Def was bound to pay the price he bid for the property
 The Clm was not aware that the Def did not know about the particulars and hence was not
considered to have taken advantage over the Def and did not mispresent any of the facts.
 This was a UNILATERAL MISTAKE.

Question 2

Hartog v Colin

Answer 2

Fact:
 Clm and Def had discussed on the tems of the deal in which in the discussion, the Def
offered to sell Argentinian hare skin and the price was quoted in piece.
 However, when writing the contract the Def mistakenly quoted the price per pound and
hence was significantly disadvantaged and the Clm knowing the mistake quickly accepted
the contract.
 Once def realised his mistake, he refused to complete the deal and Clm sued for breach.
Held:
 Although it was a unilateral mistake, the Clm had known this and had taken advantage over
it which was an unfair business practice.
 So the agreement should be declared void for mistake and should be set aside
 No contract was formed as no agreement ad idem was made.

Question 3

Foster v Mackinnon

Answer 3

Fact:
 Def was an old man who befriended a dishonest young man.
 The young man made the Def sign a document saying that the document asked him to be a
guarantor for a loan that the young man wanted to make.
 Given that the eye sight of the Def was feeble permanently, he believed the young man and
signed it believing it was for a guarantee.
 However, the document was a note promising to transfer £3000 to the Clm (the sum owned
by the young man to the Clm, the bank).
 Clm then approached the Def to claim the payment and Def said he knew nothing about it,
argued non est factum.
Held:
 Def was not bounded to pay the £3000 because he had mistakenly signed it (not because of
his carelessness) and the document was radically different to what he intended to sign
which was being the guarantor.
 So his plead of non est factum was successful and the sign was invalid

Question 4

Saunders v Anglia Building Society

Answer 4

Fact:
 Def wished to give her nephew a house and the nephew’s friend, X who was a training to
become a lawyer offered to draft a conveyance (transfer of title document) for the Def.
 However, in the conveyance, he changed the nephew’s name to his name and the Def
signed it without reading the conveyance carefully as her reading glasses were broken.
 X then used the document to get a mortgage loan, with the house as a collateral and ran
away with the money.
 The Clm (Bank) applied to court to remove Def from the house when mortgage payment was
not made.
Held:
 Def’s claim for non est factum failed because the mistake was made due to her own
carelessness (she could have just gotten a new glass) and that lead to her not reading the
whole document.
 It was also unsuccessful because the document was not radically different from what she
intended to sign which was still the conveyance, the only diff is the name.

Question 5

Phillips v Brooks

Answer 5

Fact:
 X entered a jewellery store and chose a few items and presented a cheque.
 Clm (shop assistant) said that items can only be received once the cheque has been cleared.
 But X said that he was Sir George Bullough, a rich person and Clm agreed to give the item to
X, not knowing that X was a fraud. He only realised this when the cheque was not cleared.
 X then sold the items to Def (a pawn shop).
 Clm attempted to recover the jewelleries from the Def claiming that there had been no
contract and he entered it with a mistaken identity.
Held:
 The contract was not void for mistaken identity as when the agreement was made, the Clm
had intended to deal with the man in front of him regardless of his identity.
 The identity was only important in deciding whether or not the jewelleries should be given
to the fraudster before the check was cleared.
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 Hence, the thief obtained good title of jewellery which he had passed to the Def who was
the rightful owner of the goods.

Question 6

Cundy v Lindsay

Answer 6

Fact:
 Lindsay (Clm) were linen manufacturers and they were sent some orders from a person
named Blenkarn who pretended to be from a company called Messrs Blenkiron, a wellknown business.
 The Clm mistakenly believed they were dealing with Messrs Blenkiron and sent the
handkerchiefs as ordered.
 Blenkarn then sold it to Cundy (Def) and disappeared.
 Clm sued Def to return the goods on the grounds of mistaken identity when dealing with
Blenkarn, who was thought to be from the Blenkiron business.
Held:
 The Def must return the goods to the Clm because the contract with Blenkarn was void for
mistaken identity.
 Clm had only one person in mind (Blenkiron) when making the agreement and had never
intended to deal with the thief.
 The identity of the party was of crucial importance to the Clm and so there was no
consensus ad idem
 If no such person or business exists then the courts will not accept a plea of mistaken
identity.

Question 7

Kings’s Norton Metal v , Merrett & Co

Answer 7

Fact:
 A rogue (Wallis) ordered goods by letter from the Clm, who were metal manufacturers and
disguised it to be a business called Hallam & Co, which did not exist actually.
 Clm sent the goods ordered to the address and requested payment as well.
 But the rogue sold the goods to the Def, who bought them in good faith
 When Clm found out, they sued the Def for return of good claiming mistaken identity.
Held:
 The contract was not void for mistaken identity as there were no other company known as
Hallam & Co whom the Clm had intended to deal with in the first place.
 So a valid contract was made between the rogue and the Clm. A valid contract was made
because there was already a consideration from which is to pay but the rogue did not pay.
This implied that a valid contract was made upon agreement by both parties but the thief
had breached it for not paying.
 Wallis was able to pass good title to the Def.
 Furthermore, no further extensive check was made to verify the ID of the customer, hence
cannot claim for mistaken identity.

Question 8

Hudson v Shogun Finance 2003

Answer 8

Fact:
 A rogue pretending to be Mr Patel (whose driving licence had been stolen) selected a car
that he wished to buy for credit.
 The Garage made an arrangement with the Clm (Finance Co) to finance the purchase for Mr
Patel.
 The Clm received documents from the Garage with regards to Mr Patel, which it had
checked and checked with the electoral register and the County court Judgement List.
 When the rogue got the car, he sold the car to the Def and disappeared without paying the
loan.
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 The Finance Co sued Hudson for recovery of the car using the Tort of Conversion
Court of Appeal Held:
 The key issue was whether this is a face to face sale or a distance sale.
 Identity was a crucial issue for the Clm when agreeing to enter the contract because Clm was
sure that Mr Patel is eligible for the finance based on its background check and it was not a
face to face dealing as the Garage was not an agent of the Clm and the dealings were at a
distance.
 So the contract was not legally binding and was void given that it was entered into under a
mistaken identity and would be set aside for lack of consensus ad idem.

Question 9

Couturier v Haste

Answer 9

Fact:
 Corn was being transported from Greece to London and the Def (seller) had enter in an
agreement with Clm to sell it
 But unknown to both of them, the corn had overheated on route and had to be sold to avoid
it from being obsolete. Hence, at the time of the agreement, the corn had no longer existed.
 Clm sued for breach of contract for failing to deliver the promised goods.
Held:
 The contract was voided as the contract was for a specific purchase of those corns, which
had no longer existed at the time the agreement was made.
 Hence no binding contract has been made and no consensus ad idem as a result.
 Def was not in breach of contract.

Question 10

Raffles v Wichelhaus

Answer 10

Fact:
 Clm makes an offer to sell cotton to def and def accepted it.
 Clm agreed to send 125 bales of cotton ex-Peerless from Bombay thinking it was on the
December ship while the Def thought it was the October Ship.
Held:
 Both parties had made a bilateral mistake about the identity of the subject matter of the
contract.
 So in reality, there was no consensus ad idem between the parties.
 So the contract was never made in the first place.