Mistake Flashcards
(16 cards)
Absence of genuine agreement: Raffles v Wichelhaus
A contract is void where the parties are at cross purposes and there is no objective agreement (mutual mistake).
Abseence of genuine agreement: Scriven Bros v Hindley
Where a buyer is misled by the seller’s conduct, a unilateral mistake may void the contract if induced by the seller
Common mistake: Non-existance of subject matter: McRae v Commonwealth Disposals Commission
Where one party assumes responsibility for the existence of the subject, a contract is not void but gives liability for breach
Common mistake: Non-existance of subject matter: Couturier v Hastie
A contract is void if the subjet matter has ceased to exist at the time of contracting
Common mistake: As to the possibility of performance (Physical): Sheikh Brothers
A contract may be void for common mistake if physical impossibility renders performance fundamentally different from what was agreed.
Common mistake: Legal impossibility of performance: Cooper v Phibbs
A contract is voidable in equity where a common mistake concerns legal ownership, making performance legally impossible
Common mistake: Commercial impossibility of performance: Griffith v Brymer
Where the basis of the contract is frustrated at formation (a cancelled event for example), the agreement is void for common mistake
Common mistake: Quality of the subject matter: Bell v Lever Brothers
Where:
- The mistake of both parties as to the thing contracted for
- The difference makes it essentailly different from the thing as it was believed to be
The contract can be void
Common mistake: Quality of the subject matter: Associated Japanese Bank
- Confirmed Bell v Level
- Non existence of the subject matter of the principle contract is of fundamental importance
Common mistake: Quality of the subject matter: Galloway v Galloway
A contract is void where a shared mistaken assumption goes to the legal possibility of the agreement
Common mistake: Quality of the subject matter: *Great Peace Shipping**
Mistake only operative where:
1) Non-existence of particular state of affairs not attributable to either party
2.) Non-existence renders contract impossible to perform
3.) State of affairs may be the existance/vital attribute of consideration to be provided
Fundamental mistake: Bell v Lever Brothers
Mistake MUST DESTROY the identity of the contract’s subject matter
Unilateral mistake as to the promise: Smith v Hughes
- A party is bound by how their conduct would reasonably be understood
- Contract remains valid unless the non-mistaken party knew of or caused the mistake
- You are bound by what you appear to agree to, not what you thought you were
Unilateral mistake as to identity: Shogun finance
When identity is crucial to the contract, and a purchaser provides false information about their identity, the contract becomes void.
Whether a third party acted in good faith is irrelevant, the contract is void ab initio and no good title is transferred.
Unilateral mistake as to identity: Cundy v Lindsay
When a contract is made with a specific person in mind, mistaken identity can void the contract. No valid contract -> no transfer of good title.
Unilateral mistake as to identity: Lewis v Averay
Contract is valid despite mistaken identity in face-to-face transactions. Seller intended to contract with person physically present
