Restitution Discussion Group Archives
| Sender: |
Paul Michalik |
| Date: |
Fri, 18 Oct 2002 08:24:18 +1300 |
| Re: |
Solle v. Butcher bites the dust |
This argument has been rendered moot for New Zealand
Lawyers by statutory reforms of the 1970's.
The Contractual Mistakes Act 1977 sets out when a mistake
will operate to vitiate a contract.
(Although I wasn't a lawyer then :-) and so I stand to
be corrected ) I understand that the Act was regarded as codifying the
Common Law of the time as to what amounted to an operative mistake, sufficient
to justify the intervention of the Courts. The Court was then granted
wide discretion to craft a remedy appropriate to the circumstances.
Section 6(1)(b) seems to be the codifier's attempt to
articulate the answer to what Steve sets out as the remaining problem:
which types of assumption are "fundamental" enough to matter? The answer
is that a mistake is fundamental where it either results in a substantially
unequal exchanges of value, or results in a benefit or burden being conferred
or imposed that is disproportionate to the consideration given or received
in return.
The text of section 6 of the Act sets out the tests:
6 Relief may be granted where mistake by one party
is known to opposing party or is common or mutual
(1) A Court may in the course of any proceedings or on
application made for the purpose grant relief under section 7 of this
Act to any party to a contract-
(a) If in entering into that contract-
(i) That party was influenced in his decision to
enter into the contract by a mistake that was material to him, and
the existence of the mistake was known to the other party or one or
more of the other parties to the contract (not being a party or parties
having substantially the same interest under the contract as the party
seeking relief); or
(ii) All the parties to the contract were influenced
in their respective decisions to enter into the contract by the same
mistake; or
(iii) That party and at least one other party (not
being a party having substantially the same interest under the contract
as the party seeking relief) were each influenced in their respective
decisions to enter into the contract by a different mistake about
the same matter of fact or of law; and
(b) The mistake or mistakes, as the case may be, resulted
at the time of the contract-
(i) In a substantially unequal exchange of values;
or
(ii) In the conferment of a benefit, or in the imposition
or inclusion of an obligation, which was, in all the circumstances,
a benefit or obligation substantially disproportionate to the consideration
therefor; and
(c) Where the contract expressly or by implication makes
provision for the risk of mistakes, the party seeking relief or the
party through or under whom relief is sought, as the case may require,
is not obliged by a term of the contract to assume the risk that his
belief about the matter in question might be mistaken.
(2) For the purposes of an application for relief under
section 7 of this Act in respect of any contract,-
(a) A mistake, in relation to that contract, does
not include a mistake in its interpretation:
(b) The decision of a party to that contract to enter
into it is not made under the influence of a mistake if, before he enters
into it and at a time when he can elect not to enter into it, he becomes
aware of the mistake but elects to enter into the contract notwithstanding
the mistake.
__________________________________ work mob 027 - 233 2003
-----Original Message----- Duncan Sheehan wrote:-
I think what this amounts to is saying
that frustration in contract represents a special type of misprediction
that works, but does not affect the general rule that mispredictions
do not count. ... which in turn suggests that, if
there is a principled basis for combining the restitution and the contract
doctrines, it isn't to be found in the mistake/misprediction distinction
- unless of course there is a principled reason why one particular type
of misprediction is treated differently from all the others.
If we ask rather about the basis of
the transaction (or "the parties' common assumptions", if you prefer),
the similarities are more straightforward. It is enough that the parties'
agreement embodied an assumption, which turned out to be inaccurate.
Whether the mistake could in principle have been discovered before the
payment or not is beside the point. This leaves us with the problem
of saying which types of assumption are fundamental enough to matter,
but I think we have that problem anyway.
Of course, most of the cases will
in practice involve mistakes - the argument is that it is not convenient
or analytically correct to base them on that. Indeed, as we know, the
same principles have been applied where one party was not mistaken at
all, but nonetheless their transaction embodies a false assumption -
as where money is demanded and paid on the basis that it is due, the
payor already realising that it is not in fact due (Woolwich, the last
5 overpayments in Nurdin). The question is not, ultimately, what the
parties expected or predicted, but what sort of circumstances their
agreement provides for.
All of this, of course, suggests a
very narrow ambit for the doctrine of frustration, as well as "mistake".
Steve Hedley
ansaphone : +44 1223 334931 Christ's College Cambridge CB2 3BU
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Paul Michalik
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From: Steve Hedley
Sent: Friday, 18 October 2002 04:17
To: ENRICHMENT@LISTS.MCGILL.CA
Subject: [RDG:] Solle v. Butcher bites the dust
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FACULTY OF LAW, UNIVERSITY OF CAMBRIDGE
www.stevehedley.com
fax : +44 1223 334967
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