Case Law Error Analysis

Contract Law Mistakes Mutual Mistakes in Contract Law

Contract Law Mistakes

This paper will analyze a case that explores mistakes under contract law. Both of the parties will be investigated in this case. It will also study the concept of mutual mistake of fact, and whether rescission of the contract can be done.

Case Background

Supposing an individual, Josh Hartly wants to purchase a new automobile, and thus visits the local automobile dealer. During his negotiations with the salesperson, he states that he requires the 3.2 liter V-6 engine, not the 3.9 liter one, as he has doubts pertaining to the 3.9 liter engine's fuel economy. Josh then enters into a contract, and agrees to buy a car fitted with a 3.2 liter V-6 engine (Paper Instructions Provided by Customer). What neither the salesperson nor Josh was aware of was that the 3.2 liter and the 3.9 liter were no longer being manufactured; instead, the manufacturer was equipping new cars with a new 3.5 liter engine.

Analysis

Mistake of fact may be one of the factors that eliminates or reduces criminal culpability or civil liability. It holds no consequence if it doesn't stem from forgetfulness or unconscious ignorance. An individual cannot escape criminal or civil liability for deliberate mistakes. A mistake of fact under contract law may be brought forward as a form of defense by any party that seeks to evade liability under any contract. Furthermore, mistakes of fact may be affirmatively employed for canceling, rescinding, or reforming contracts. They can have an impact on the contract only in case the detail was crucial, or material, for the agreement. Assume, for instance, that a vendor of books has decided to sell a Virginia Woolf book, autographed by the author. Further assume that the customer only wants to purchase the book as it contains the late author's autograph (Legal Dictionary a., n.d). This fact is known by the seller; also, an authentic autograph commands a very steep price. If the customer later discovers that this signature isn't authentic but was, in fact, forged years ago, and neither her nor the seller were aware of this forgery, it would be considered as a mistake of fact, which is material to the purchase; therefore, the customer can return the purchased book and request a refund. This example explains the concept of mutual mistake, or some material fact that both parties have mistaken. In this sort of instance, the party affected adversely by a mistake is entitled to rescind or cancel the contract. When the mistake is unilateral, only one of the parties to the contract is mistaken concerning some material fact. Here, the party affected adversely by this mistake cannot avoid the agreement unless the mistake was known or ought to have been known by the second party, or unless the latter was duty-bound to reveal the fact that was mistaken (Legal Dictionary a., n.d). Assume, for instance, that an individual owns a pricey sports car, which is in excellent condition. Further supposing that the owner is asked by a neighbor if he is willing to sell it; the owner responds in the affirmative, stating that he will sell it for '30 bills'. In case the neighbor comes with 30 dollars, no deal is formed, since the neighbor was mistaken in his assumption that the car would cost him $30, when in fact, the owner used the slang term for $30,000. Also, the neighbor ought to have realized that such an expensive automobile couldn't possibly have been sold for a mere $30. Thus, in this instance, the parties should be capable of rescinding the contract, as the mistake was genuine, and not one made from malice or any such ill-intent. Both parties did not act in an unethical manner, as neither party intended, or knew of, the mistake.