Audio recording 23.1

Audio recording 23.1 transcript

So, chapter twenty-three is focused on what's often known as common mistake. And I think that orthodoxy at the moment is to  treat common mistake is a rule of law, and based upon its own distinct doctrine. And that's how I think most judges probably treat this issue, but not all. And some judges treat this as based upon an implied term analysis, which I think is the most helpful way of approaching this topic. And that's the approach that's adopted in  this book, is an approach which JC Smith advocated strongly before as well, and is consistent with how we think about the law of contracts. But it's important that when the chapter discusses an implied term, it's not an implied promise. It's not a promissory term that we're focused on. So, you can imagine that there might be some situations where I promise to you that something exists, or that something will continue to exist. And then if that thing does not exist, or it doesn't continue to exist, then I'll be in breach of my promise. Right? That's the sort of implied terms we looked at in chapter thirteen, and I'll then have breached my promise to you. What we're focused on in this chapter really are situations where we both proceed on a common assumption that the thing exists, and neither of us are more responsible than the other for this common assumption that we've made. But if we say that there's an implied term, that the thing exists, so neither of us are  promising that the thing exists, but we are going to say there's an implied term that the thing exists. Then if the thing doesn't exist, then there will be no contract. Or you could say that the agreement is void. And so, we could call that sort of implied term an implied condition precedence. So, say if it fails, there simply isn't a contract. But whether you think that it does rest upon an implied term analysis, or is its own distinct doctrine that's externally imposed as a matter of law, the results reached by the cases would invariably, I think, be the same. It doesn't seem to lead to different outcomes, it leads to different sorts of reasoning. And as a general rule, right? But whatever approach you take, I think it is important to appreciate that common mistake is an incredibly narrow doctrine. It's very unlikely that the court is going to find that a contract is void on the basis of common mistake. And that's particularly so when we think about a mistake of quality. It's really hard to find an example where a contract's been held to be void because of a mistake of quality. So, let's say that we enter into a contract for the sale of a horse, and we both think that the horse is healthy, which is a very famous example, taken from Bell v Lever Bros, then even if we're both mistaken, and in a sense share a common mistake because the horse isn't healthy, the horse is unhealthy it's an unsound horse, then that wouldn't make the contract void. Now that's not an efficiently fundamental, or basic mistake that would make the contract void. So, bear that in mind when you're discussing the role of mistake in contract law, and I think it's also important to emphasize that after the Great Peace it's clear that the effect of common mistake is to make a contract void, not voidable. And the leading guidance is clearly to be found in Bell v Lever Bros, and more recently the Great Peace which is really important decision, which is useful to read in full, I think.