Private Law 4 Flashcards
What are the two types of error?
Unilateral
Bilateral
What are the two forms of bilateral error?
Mutual error (parties at cross purposes on an essential of the contract).
Common error (both parties make the same
mistake on an essential).
Both errors have the same effect (can render a contract void).
What case establishes a mutual bilateral error?
Stuart & Co v Kennedy (Garden Wall Coping + questions over what type of foot).
No consensus between both parties (mutual error), Coping Stones paid for at ordinary market rate.
What case establishes a common bilateral error?
McLaughlin v The New Housing Association (miscalculation).
McLaughlin purchased a property she was originally leasing. The sale price was calculated using the formula provided by the Housing Act 1987. However, a miscalculation was made.
This error regarding the calculation was in the substantials so the agreement was set aside.
What is an induced unilateral error?
One party to a contract is misled or deceived by the other party, causing them to make a mistake about a fundamental aspect of the contract
What is misrepresentation?
Misrepresentation arises when one of the parties has said or done something to persuade the other to enter into a contract under a mistaken belief.
A misrepresentation must be an inaccurate statement of fact.
Are misrepresentations void or voidable?
Where the misrepresentation induces essential error, the contract is void. Otherwise, it is merely voidable.
To have this effect a misrepresentation must be made to the innocent party by the other party to the contract.
What case emphasises the difference between a statement of opinion and a misrepresentation?
Flynn v Scott (van in good running order).
Van broke down 7 days after second-hand purchase, this was deemed too long for a rejection by Flynn.
What are the 3 forms of representation?
- Innocent (Acted in Good Faith)
- Fraudulent (Acted Deliberately)
- Negligent (Legal Duty Disregarded + Negligent Statement Made)
What case establishes innocent misrepresentation?
Boyd & Forrest v Glasgow & South Western Railway Company (construction of an embankment).
The engineer provided misleading information, however this was innocent.
The court held the contract was only voidable.
What case establishes fraudulent misrepresentation?
Smith v Sim (Public House + difference between turnover and profitability).
Smith could claim damages due to fraudulent misrepresentation, however the contract was NOT set aside.
What case establishes negligent misrepresentation?
Cramasco LLP v Oglive Grant (Lease agreement for a Grouse Mouse).
Pre-contractual obligations were negligent. Cramasco could claim for damages, but the contract itself was NOT set aside.
What is an uninduced unilateral error?
One party makes a mistake without any influence or deception from the other party.
Normally they will have no effect on the contract.
What case establishes an uninduced unilateral error?
Stewart v Kennedy (sale of an entailed estate + claim for fraudulent misrepresentation).
The court held the error did not amount to an “essential error”.
Whart case is an example of “error plus” and “snatching at a bargain” ?
Steuarts Trustees v Hart (feu-duty was not mentioned in the contract).
Hart took advantage of this essential error.
Restitution was the proper remedy in this case.
