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Doctrine Of Mistake Notes

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Unilateral Mistake In general

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Smith v Hughes [1871]: o Cockburn CJ:
? As long as objectively the parties can have said to have agreed on the subject matter of the contract (e.g. parcel of good oats)

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Then C not responsible for correcting D's self induced mistake, (parcel of oats are old oats when they are actually new oats) Exception 1: Where there is objectively a mistake as to terms Exception 2: Mistake as to identity of other party

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In general, courts will void a contract if identity of the party is mistaken, not if just the attributes of that party are mistaken (e.g. solvency, social position) (this being merely voidable for misrepresentation)

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Four contradictory factors "guide" the court on whether dealing with attribute (non-voidable) or identity (voidable): o Objectivity - X cannot accept an offer meant for Y
? Ingram v Little [1961]: C sold car to H only after H identified himself as PGMH living at an address C checked as accurate in phone book. H actually rogue and not PGMH, dishonoured cheque, sold to D, innocent party.

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Sellers LJ: o The mere presence of an individual cannot be conclusive that an apparent bargain he may make is made with him.
? E.g. If he were disguised in appearance to represent someone else and the other party, deceived dealt with him on the basis but wouldn't have done if knew truth

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then, there would be no contract established o But this is a question only answerable in each case by its own facts.
? Lewis v Averary [1972]:

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Megaw LJ: o In this case, can't be said that L thought the identity of R was of vital importance to him
? He would have sold to anyone

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Thus, contract is valid.

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Moi: o Only where name represented is of vital importance to C (e.g. famous painter/ respected tradesman)
? Should the presumption that C intends to deal w/
person in front of him be rebutted and contract void
? Else, contract only voidable on notice per Lord Denning for any other mistake of identity/attributes.

o Written Contracts
? When contract is in writing, only parties named in document are parties to contract
? Cundy v Lindsay [1878]: A, a rogue, rented some rooms near famous firm of cloth dealers. Since trade name was similar to said firm, C dealt w/ A thru written correspondence on this basis. A sold on lace, and then did not pay C what was due.

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Lord Hatherley: o C never thought they were dealing with A
? They corresponded with Blenkiron & Co sent all of their invoices addressed to Blenkiron & Co, believed they were contracting with and selling to said firm, not A. o Thus, A can never have had any chance of gaining title to pass on to anyone else.Shogun Finance v Hudson [2003]: X agreed a deal for sale to R on stolen driving licence of P. After credit check based on this identity, C, who had no contact with R, authorised X to sell car to whom R had represented self as (P). The next day, R sold the car to D, a good faith purchaser, whom C then sued after discovering the fraud

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Lord Hobbhouse (maj): o The name written on the document is different from negotiations face to face
? there was no consensus ad idem, R having no honest belief or contractual intent whatsoever and the finance company believing that it was accepting an offer by P o R may have negotiated with X orally
? But as far as C was concerned, C was dealing with P

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Lord Nicholls (dis): o Presence of writing does not give reason for any distinction from face-to-face cases
? Fact that A believes he is dealing with B when in fact B is C is not relevant. o What matters is whether A agreed to sell his goods to the person dealing with, not why he did so or under what name.
? The latter is relevant to remedy, not to formation of a contract

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Lord Millet (dis): o Rule should be that while Y can't intercept and accept an offer made to someone else, whatever the medium of communication, a contract comes into existence if, on an objective appraisal of the facts,
? It can be said that a party's offer has been accepted by the person to whom it was addressed.

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