⇒ Mistake is a very narrow doctrine → Bell v Lever Bros [1932]: 'if mistake operates at all, it operates so as to negative or in some cases to nullify consent' (Lord Atkin)
⇒ Some areas of mistake lack clarity:
⇒ Mistakes can be of fact or of law: Kleinwort Benson Ltd v Lincoln City Council [1999] confirmed in Brennan v Bolt Burdon [2004]
⇒ There are two types of mistake:
⇒ Burrows defines an agreement mistake as follows: ‘a mistake of one party which is not shared by the other party and which may, or may not, be known about the other party’
⇒ There are two types of agreement mistake:
⇒ Agreement mistake is a restricted doctrine
⇒ Often in agreement mistakes there would have been a misrepresentation: Merrill Lynch International v Amorim Partners (2013)
⇒ There are 3 areas where an agreement mistake will be actionable and so the contract will not stand:
⇒ It is a restricted doctrine, but can nevertheless can invalidate a contract in very specific circumstances
⇒ Inconsistent case law on this, and everybody thought Shogun Finance v Hudson [2003] would clear this up but it did not
⇒ The distinction is, when there is a contract entered face to face inter praesentes) there is a presumption even though the rogue is pretending to be someone else, you want to contract with that person in front of you and there cannot be a mistake
⇒ HOWEVER when they contract on a correspondence basis (inter absentes), the person you are presumed to contract with is the person the rogue is pretending to be - THIS DISTINCTION IS VERY IMPORTANT
⇒ If a contract is entered into to sell your house to a rogue, then the rogue sells the property to a third party, if the contract is void it is considered the property has never left the original owner (therefore there is no valid basis for the rogue to acquire the property). So, when he sells the property to the third party, because he did not have the right to acquire the property he cannot pass it on. So, in this situation we have two parties that need protecting: yourself and the innocent third party
⇒ Can there be a unilateral mistake in equity?
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⇒ Common mistake = the parties have contracted on the basis of a shared (common) mistake e.g. the parties contracted on something which did not exist at the time of contracting
⇒ Distinction between common law and equity:
⇒ So when did Denning think a contract would be voidable in equity:
⇒ Mistake at equity is much wider than that in the common law
⇒ E.g. If 2 parties contract about the hire of a car which unknown to both parties had been destroyed the day before by a fire, the contract will be void for common mistake
⇒ See the case of Galloway v Galloway (1914) and Couturier v Hastie (1856)
⇒ Subject matter that NEVER existed:
⇒ Mistake as to the quality of the good being sold E.g. Where parties contract about a chair where both believe it to be an expensive antique, but turns out to be a fake
⇒ See the case of Bell v Lever Bros (1932) → Lord Atkin said that a mistake as to quality had to be “the mistake of both parties” and a mistake about the “existence of some quality” which made the contract different to the one intended.
⇒ Non est factum means "it is not my deed"
⇒ Non est factum is argued when the contract is very different from what the person believed to be signing
⇒ Very restricted doctrine only used in very serious mistake e.g. Saunders v Anglia Building Society [1971]
⇒ An equitable remedy given by the court designed to correct a contract to reflect what it should have said in the first place
⇒ It is argued in very limited circumstances
⇒ Requires:
⇒ See the case of Joscelyne v Nissen [1970]
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