Mistake as to identity involving third parties is so confusing, extremely in cases like Philips v Brooks, Ingram v Little, Lewis v Averay... Why does the court allow the mistaken part to recover goods from the innocent third party but in certain circumstances the court refused?
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Contract law- mistake Watch
- Thread Starter
- 14-05-2013 15:25
- 14-05-2013 17:52
Because the court is silly. It shouldn't. The doctrine rests on artificial distinctions between (a) attributes and identity (see Denning in Lewis) and (b) face-to-face and other transactions.
See per Lord Nicholls (dissenting) in Shogun Finance v Hudson:
“it is little short of absurd that a subsequent purchaser’s rights depend on the precise manner in which the crook seeks to persuade the owner of his creditworthiness and permit him to take the goods away with him… The purchaser’s rights should not depend upon the precise form the crook’s misrepresentation takes.”
As also noted by Lord Nicholls, the lengthy sterile argument over whether or not the dealer was an agent shows how arbitrary the results here are.
Note also the bizarre distinction between pretending to be a real company by correspondence (contract void -- Cundy v Lindsay) and pretending to be a company you've made up (contract valid -- King's Norton v Edridge).
Ingram v Little is quite clearly factually indistinguishable from Philips and Lewis, and was disapproved by Lord Walker in Shogun, but the rest of the majority remained silent on the matter. Presumably the 'presumption' point made in Ingram is still good law, however wrong the decision on the facts.
In any event, if you're looking for guidance on the substance rather than criticism:
(a) where the contract is written, whether concluded face-to-face or by correspondence, the party with whom the mistaken party intended to contract is the person named in the document; so, in Shogun, where the rogue pretended to be a Mr Patel, it was held that Mr Patel (with his phone number and address etc listed) could only identify the real Mr Patel; and that, therefore, since Mr Patel had not assented to the contract, it was a nullity.
(b) Where the contract is made inter praesentes, and not embodied in a written instrument, there is a very strong presumption that the vendor intended to sell to the person physically present. Though Ingram v Little is wrongly decided on its face, the hypotheticals of the famous artist (etc) given in that case appear still to apply.
You'll have to think about the position where a contract is made by phone (does it make a difference if it's by video chat? What if it's by text?) -- the arbitrariness of any possible line-drawing here was another argument made my Lord Nicholls in Shogun.
In short, the pre-Shogun law is still good law. The majority made their decision on the basis of construction of a written instrument.Last edited by TimmonaPortella; 14-05-2013 at 17:54.