A. Mistake

Question 1

What is required for mutual mistake of fact (voidable)?*

Answer 1

1) Mutual mistake!!!
- BOTH parties made mistake

2) Of fact
3) Existed at the time of entering contract!!!

4) Material/Substantial!!!
- Goes to foundation of agreement

Question 2

What are the remedies for unilateral/mutual mistake of fact?*

Answer 2

• Rescission
• Reformation
• Court-ordered relief (only for ‘exceptional situations’)

Question 3

What is required for unilateral mistake of fact?*

Answer 3

1) Unilateral mistake
- ONE of the parties made mistake

2) Material Fact
3) Existed at the time of entering contract

4) Either (on Non-Mistaken Party’s part);
- Fraud
- Duress
- Similar inequitable conduct

5) NOT knowingly made (despite ordinary care exercised)
6) Unconscionable/Unjust enrichment of one party (if contract is enforced)
7) Parties returnable to status quo with NO prejudice