Understanding Mistakes in Contracts: Common vs. Unilateral
This blog post series has explored different types of mistakes that can impact the validity of a contract. Today, we’ll differentiate between common mistakes and unilateral mistakes.
Common Mistakes:
- Shared Misunderstanding: Both parties hold the same mistaken belief about a fundamental aspect of the agreement. They agree to the contract terms based on this misunderstanding.
- Subject Matter Mistake: The mistake often relates to the nature or existence of the subject matter of the contract (e.g., buying a fake painting thinking it’s real).
- Contract Void or Voidable: If the mistake is significant enough, the contract may be void (no legal effect) or voidable (can be cancelled).
Unilateral Mistake:
- One-Sided Error: Only one party is mistaken about a key aspect, while the other party is aware or should be aware of the mistake.
- Limited Scope: Mistakes typically involve contract terms or party identity, not general facts.
- Taking Advantage: A crucial element is the aware party exploiting the mistake for their gain.
- Subject Matter Quality Not Covered: Mistakes about the quality or features of what’s being exchanged are generally not grounds for voiding the contract under unilateral mistake.
Key Distinction:
- Shared vs. One-Sided: Common mistakes involve a misunderstanding shared by both parties, while unilateral mistakes involve only one party being mistaken.
Additional Note:
- Mutual Mistake: This refers to a broader concept where both parties have misunderstandings about key elements of the contract, such as identity or terms.
Remember: Both common and unilateral mistakes can be complex legal issues. If you suspect a mistake in your contract, consulting a lawyer is recommended for specific advice on the potential consequences.
Created by iax, Enhanced by AI
Proudly powered by WordPress