Mistakes in English law

Mistake is a term of art in both contract law and criminal law in England and Wales.

Contract law

Mistakes are a group of rules in English contract law, which happen to share the same name. If the law deems a mistake to be sufficiently grave, then a contract entered into on the grounds of the mistake may be void. A mistake is an incorrect understanding by one or more parties to a contract. There are essentially three types of mistakes in contract,

• unilateral mistake is where only one party to a contract is mistaken as to the terms or subject-matter. The courts will uphold such a contract unless it was determined that the non-mistaken party was aware of the mistake and tried to take advantage of the mistake.^[1] It is also possible for a contract to be void if there was a mistake in the identity of the contracting party. An example is in Lewis v Averay^[2] where Lord Denning MR held that the contract can only be avoided if the plaintiff can show that, at the time of agreement, the plaintiff believed the other party's identity was of vital importance. A mere mistaken belief as to the credibility of the other party is not sufficient.
• mutual mistake is when both parties of a contract are mistaken as to the terms. Each believes they are contracting to something different. The court usually tries to uphold such a mistake if a reasonable interpretation of the terms can be found. However, a contract based on a mutual mistake in judgement does not cause the contract to be voidable by the party that is adversely affected. See Raffles v Wichelhaus.^[3]
• common mistake is where both parties hold the same mistaken belief of the facts. This is demonstrated in the case of Bell v Lever Brothers Ltd,^[4] which established that common mistake can only void a contract if the mistake of the subject-matter was sufficiently fundamental to render its identity different from what was contracted, making the performance of the contract impossible. This is similar to frustration, except that the event precedes, rather than follows the time of agreement.

Common mistake

• McRae v Commonwealth Disposals Commission (1951) 84 CLR 377
• Bell v Lever Bros [1932] AC 161
• Grist v Bailey [1967] Ch 532
• Nicholson & Venn v Smith-Marriot (1947) 177 L.T. 189
• Associated Japanese Bank (International) Ltd v Credit du Nord [1989] 1 WLR 255
• Brennan v Bolt Burdon [2004] 3 WLR 1321

• Galloway v Galloway
• Scott v Coulson

Res Sua, where the subject matter already belongs to oneself

• Cooper v Phibbs

Res Extincta, where subject matter does not exist

• Couterior v Hastie

• Sale of Goods Act 1979 s 6

• Great Peace Shipping Ltd v Tsavliris Salvage (International) Ltd [2003] QB 679

Mutual mistake

• Raffles v Wichelhaus (1864) 2 H & C906; 159 ER 375

Unilateral mistake to identity

Mistake as to identity occurs when one party - usually fraudulently - believes themselves to be bargaining with another, uninvolved, third party. In a typical situation of this kind, the contract will either be void for mistake, or voidable for fraud. Such a distinction depends on the manner in which the contract was made. Cundy v Lindsay^[5] demonstrates this principle; here, a firm contracted by post to sell handkerchiefs to a rogue, masquerading as a legitimate company, Blenkiron & Co. The contract was held to be void for mistake: Lindsay & Co were able to recover the goods from a third party who had purchased them from the rogue (as the rogue did not have good title (property) to pass on to them). This can be contrasted with the case of King's Norton Metal Co v Edridge Merrett & Co,^[6] where a similar situation occurred. Here however, the company name that the rogue used did not exist; as in Cundy v Lindsay, Kings Norton Metal Co could not claim they relied upon the false company name to contract. Therefore the contract was merely voidable for fraud, and the third party obtained good title to the goods.

A further distinction which can be drawn is where a contract is made face to face; that is, generally, in shops and markets. Where a contract is concluded this way, there is a strong presumption inferred by the courts that the seller intends to contract with the person in front of them. Thus in this situation it is much harder for the seller to claim a contract is void for mistake to identity. The principle is well demonstrated in the famous case of Phillips v Brooks.^[7] However, the law becomes somewhat convoluted and less certain when considering subsequent decisions, such as Ingram v Little.^[8] The principle has recently been upheld (albeit by a small margin of 3 to 2) in the House of Lords decision of Shogun Finance Ltd v Hudson,^[9] despite persuasive reasoning to abandon it. The current situation can be seen as less than ideal, as it is the third party buyer who loses out when contracts are considered void for mistake to identity. In Shogun Finance Ltd v Hudson the minority of Lord Nicholls and Lord Millett argued strongly that all mistakes for identity merely render a contract voidable.

Unilateral mistake as to terms

• Hartog v Colin & Shields [1939] 3 All E.R. 566
• Smith v Hughes (1871) LR 6 QB 597
• Solle v Butcher [1950] 1 KB 671
• Clarion Ltd v National Provident Institution [2000] 1 WLR 1888

Non Est Factum

• Saunders v Anglia Building Society (Gallie v. Lee) [1971] AC 1004

Rectification

• F.E. Rose (London) Ltd v WH Pim & Co Ltd [1953] 2 Q.B. 450

Criminal law

Mistake of fact

Mistake of fact may be a defence in criminal law if is genuine, whether or not it is reasonable.

In DPP v Morgan^[10] an RAF man told three officers to have sex with his wife, and she would pretend to refuse just to be stimulating. They pleaded mistake, and the jury did not believe them.

R v Williams (Gladstone) established the principle that a belief (that a certain set of facts are true) need not be reasonable to operate under the defence of mistake. However, the reasonableness of that belief is material in deciding whether the defendant actually had that belief.^[11]

An exception to this appears to be bigamy (see R v Tolson (1889) 23 QBD 168).

The Sexual Offences Act 2003 has introduced a hybrid test of reasonable belief as to consent. The defendant must now be seen to have taken steps to ascertain clearly whether the "victim" was consenting in all the circumstances. This abolishes the defence of a genuine though unreasonably mistaken belief as to the consent.

Mistake of law

Mistakes about the criminal law

It is not a defence that the defendant held an honest and reasonable belief that what he was doing was not criminal.^[12] Where the defendant is a foreigner, and the offence is not criminal in his own country, the fact of such a belief is still not a defence.^[13] It is not a defence that the defendant believed that he would not be prosecuted for what he was doing.^[14]

Offences created by statutory instruments

Section 3(2) of the Statutory Instruments Act 1946 provides:

In any proceedings against any person for an offence consisting of a contravention of any such statutory instrument, it shall be a defence to prove that the instrument had not been issued by [or under the authority of] His Majesty’s Stationery Office at the date of the alleged contravention unless it is proved that at that date reasonable steps had been taken for the purpose of bringing the purport of the instrument to the notice of the public, or of persons likely to be affected by it, or of the person charged.

(Words in brackets inserted by section 1(1)(a) of the Statutory Instruments (Production and Sale) Act 1996, as read with section 1(2))

Mistakes about the civil law

A mistake about the civil law may have the effect of negativing the mens rea for an offence. See:

• Section 2(1)(a) of the Theft Act 1968
• R v Smith (David Raymond) [1974] QB 354, 58 Cr App R 320, [1974] 2 WLR 20, [1974] 1 All ER 632, CA
• R v Gould [1968] 2 QB 65, 52 Cr App R 152, [1968] 2 WLR 643, [1968] 1 All ER 849, CA
• R v Barrett and Barrett, 72 Cr App R 212, [1980] Crim LR 641, CA

See also

• English tort law

• Amalgamated Investment and Property Co Ltd v John Walker & Sons Ltd [1977] 1 WLR 164

Notes

English contract law Formation Agreement Consideration Promissory Estoppel Creation of legal relations Certainty Privity Contractual terms Incorporation of terms Interpreting contracts Implied terms Unfair contract terms Breach of contract Measure of damages Specific performance Setting aside a contract Capacity Iniquitous pressure Misrepresentation Mistake Frustration

References

• P Atiyah and F Bennion, 'Mistake in the Construction of Contracts' (1961) 24 MLR 421
• J Cartwright, 'Solle v Butcher and the Doctrine of Mistake in Contract' (1987) 103 LQR 594
• P Matthews, 'A Note on Cooper v. Phibbs' (1989) 105 LQR 599