error

Common Error:

Shared Mistake: Both parties make the same mistake of fact. If the mistake is important, the contract can be render unenforceable.

Example: If a painting is sold and is lost before the sale, the contract is void due to the mistake about its existence.

Dawson v Muir (1851): Mistake of Value: Both parties thought the vats were worth £2, but they were actually worth £300 due to a mistake about the content. The court held there was no error of fact, so the contract remained valid.

 

Types of Error in Contract Law

  1. Common Error:

    • No genuine error of fact, contract remains valid.

    • Case: Dawson v Muir (1851) – Both parties believed value was £2, later found to be £300 (white lead); contract upheld.

  2. Mutual Error:

    • Both parties misunderstand the terms, but if error is incidental (not going to the root), the contract stands.

    • Case: Cloup v Alexander (1931) – Hire of a building, no specific act mentioned, upheld.

    • Case: Scriven v Hindley (1913) – Auction bidder thought barrel contained hemp, but was tow. Contract void.

    • Case: Kyle Bay Ltd v Underwriters (2007) – Misunderstanding of insurance settlement, contract valid.

    • Case: McLaughlin v The New Housing Association Ltd (2008) – Different understanding of price calculation, contract reduced.

    • Case: Wilson v Marquis of Breadalbane (1859) – Misunderstanding of cattle price, contract reduced.

  3. Identity Error:

    • Sometimes identity is essential to a contract.

    • Case: Morrison v Robertson (1908) – Fraudster buys cattle by pretending to be someone else, contract voidable.

    • Case: MacLeod v Kerr (1965) – Car sold under false identity; contract voidable but car belonged to third party.

  4. Quality, Quantity, or Extent:

    • Misunderstanding about quality, quantity, or extent can void the contract.

    • Case: Patterson v Landsberg & Son (1905) – Bought jewels thought to be antiques, were reproductions; contract void.

    • Case: Lyon & Turnbull v Sabine (2012) – Both thought a table was antique, it was a reproduction, contract upheld.

  5. Nature of the Contract:

    • Mistaken understanding of the document's nature (e.g., signing a will when you thought it was a loan agreement).

    • Case: McLaurin v Stafford (1975) – Thought he was signing a will, signed a disposition; contract reduced.

    • Case: Edgar v Edgar (1875) – Thought it was a loan agreement, signed a disposition; contract reduced.