When Mistakes Happen in Contracts: What are the Remedies?
So far, we’ve explored different types of mistakes that can impact a contract’s validity. Now, let’s discuss the potential remedies available.
1. Rescission:
- Aims to undo the contract and restore both parties to their pre-contractual positions.
- Essentially, the contract is voided as if it never existed.
- This remedy is typically available in cases of:
- Mutual Mistake: Both parties share a misunderstanding.
- Unilateral Mistake: Only one party is mistaken, but the other party knew about the mistake and acted unfairly.
2. Rectification:
- Aims to correct a written agreement to reflect the parties’ actual agreement.
- Used when there’s a mistake in the written contract, like a typo or clerical error, that doesn’t reflect the true intention.
- Rectification essentially fixes the written agreement to match what the parties truly agreed to.
Choosing the Right Remedy:
- Rescission is used to nullify the entire contract.
- Rectification is used to correct errors in the written agreement.
The appropriate remedy depends on the specific mistake and the desired outcome. Consulting a lawyer is recommended to determine the best course of action for your situation.
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