UKT CONTRACT LAW: MISTAKE

CLASS ACTIVITY
Jane meets Sam in a pub and they start talking about cars. Sam boast that she owns a Ferrari. Sam
asks Jane if she wants to buy her Ferarri. Jane agrees to buy it for $40,000. Advise Jane in each of
the following alternative circumstances.

a) Unknown to Jane and Sam, Sam’s Ferarri was destroyed earlier when her garage burnt down.
b) Sam and Jane both think that Sam’s Ferrari has a large 10 cylinder engine. In fact it has less
powerful 6 cylinder engine.
c) Sam owns two Ferraris. Sam intended to offer her red one for sale, Jane though that she was
buying the yellow one.
d) Jane pays Sam a $1000 deposit in a pub and agrees for the car to be delivered the next
morning. That night Sam’s Ferrari is destroyed in a fire.

Part A

• What type of mistake is this?

• What is the effect of such mistake?
• A relevant case to this? Briefly discuss the facts and decisions.
• What is the relevant statute applicable?
• What is the conclusion to the facts

Part B

• What type of mistake is this?

• What is the effect of such mistake?
• A relevant case to this? Briefly discuss the facts and decisions.
• What is the test used in the case.
• Was the test applied successfully in Solle v Butcher?
• Any relevant subsequent case on this test?
• What are the 5 elements introduced to prove a common mistake which is sufficient to avoid the
contract?
• What is the conclusion to the facts?

Part C

• What type of mistake is this?

• What is the effect of such mistake?
• A relevant case to this?
• Briefly discuss the facts and decisions.
• What is the conclusion to the facts

Part D - Will be discussed together in class.

PREPARED BY VIKNA PRASHANTHINI 1