Mistake in a contract

Hi,

can anyone help me with this scenario.

A puts up an advert for a t-shirt after being told its a unique and a rather valuable t-shirt, B sees advert and remembers seeing somewhere about how valuable this t-shirt is. They both meet up, and agree on a price, on the day B is supposed to hand over the money she realises it's actually a replica and refuses to pay.

My question is, is the contract void as both where mistaken to the true value of the t-shirt. Is A able to still enforce the contract because they both believed the same thing when they made the contract. Are there any cases that deal with something similar.

Thank you!

My dissertation was in the area of contract law, specifically the doctrine of mistake.

The case you are looking for is Leaf v International Galleries [1950] 2 KB 86. Both parties thought that the painting in question of the Salisbury Cathedral was done by the master landscape painter Constable. 5 years later, the buyer discovered that it was actually not a Constable painting.

The claim based on mistake failed because it was merely a mistake as to quality and not as to subject matter. As Denning LJ held at 89: 'There was a mistake about the quality of the subject-matter, because both parties believed the picture to be a Constable; and that mistake was in one sense essential or fundamental. But such a mistake does not avoid the contract: there was no mistake at all about the subject matter of the sale.'

The claim based on innocent misrepresentation for rescission failed due to the 5-year delay. However, the court did recognise at 90 that an 'innocent material misrepresentation may, in a proper case, be a ground for rescission even after the contract has been executed'.

You may analogise with Leaf v International Galleries [1950] 2 KB 86 on the point about mistake (so the contract is not void) but you could distinguish it on the point on innocent misrepresentation. In your fact scenario, there is no such analogous long time gap between the time of contract and the time of discovery of the truth about the item, and so the contract is probably voidable.

If you have time, look up Peco Arts Inc v Hazlitt Gallery Ltd [1983] 1 WLR 1315, where a drawing that was purchased turned out to be a reproduction and the purchaser succeeded in an action for rescission for negligent misrepresentation.

All the best!