P bought land from D “subject to all easements… rights and privileges (whether of a public or private nature) now affecting the property but without any obligation on the part of the vendor to define the same.” D represented that, so far as it knew, there were no encumbrances etc. It later transpired that there was a sewer on the land which decreased the value and P sought to rescind the contract on the grounds of common mistake. CA denied the claim, saying that the contract set out a duty of disclosure to one’s best knowledge on D but said that the risk lay with P. The sewer did not seriously interfere with the use of the land, so that it would not be equitable for the contract to be rescinded, for mutual mistake.
Hoffmann LJ: He supports Steyn’s point that the rules on mistake are only invoked if the contract does not state with whom the risk shall lie. Here, the contract does.
Evans LJ: There are rules on “fundamental mistake” in equity (see Solle v Butcher): “The difference may be that the common law rule is limited to mistakes with regard to the subject matter of the contract, whilst equity can have regard to a wider and perhaps unlimited category of “fundamental” mistake.” However here the sewer was of little importance.