Ex stating a price that is absurdly high or low or

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Ex stating a price that is absurdly high or low or quite unrelated to the range expressed during negotiations Mistake about terms – errors in recording an agreement Party may want to continue to be bound by a contract that contains incorrect terms - Ex. An oral agreement is made and when reduced to writing contains an incorrect term. Common/ Mutual mistake: a situation in which the parties (both) believe the same misunderstanding or mistake about the contract. Rectification: correction of a written document to reflect accurately the contract made by the parties The parties may ask the court to correct or rectify an error in a recorded agreement - Easy for common mistakes – both parties want the same thing TEST: must demonstrate that” the parties were in complete agreement upon the terms of their contract, but by an error wrote them down wrongly.” A court may grant rectification of a unilateral mistake if the following conditions are met: 1. Complete agreement with no ambiguity 2. Parties die not engage in further negotiations regarding the contract
3. Mistake may have occurred as result of fraud 4. The party seeking to uphold the contract knew or should have known about error and other party did not; and 5. Enforcing agreement would be askinh to fraud Not easy to establish – rectification will not correct an error in judgement and it is not a substitute for due diligence. Mistake about terms- misunderstandings about the meaning of words Both parties agree to the contract and to the words used – no accident or recording error - Right words, different interpretation of meaning Parties place different meaning on the words in a contract Court will decide the meaning of the words based on reasonable interpretation in light of the circumstances Where both parties and an equally reasonable (or unreasonable) interpretation of the words and holding one party to the other’s would be unfair- case of mutual mistake. - A situation in which both parties believe a mistake exists in the contract but their understanding of the mistake are different. Example: Raffels v. Wichelhaus[1894] – The ”Peerless” Case Mistakes about the subject matter Two types; - Mistake about the existence of the subject matter of a contract
- Mistake about the value of the subject matter of a contract Mistakes about the subject matter- mistake about the existence of the subject matter of a contract If at the time a contract is made, the subject matter(goods) (ex. The contents of the hold a ship) have been destroyed (unknown to either party)- case of common mistake exists Incorporated in the Sale of Goods Act - “where a contract is foe the sale of specific goods and the goods without the knowledge of the seller have perished at the time the contract is made, the contract is void.

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