Mutual Mistakes In Contract Law
Short Paper Analysis
During the event of purchasing a car it can sometimes confusing for people and mistakes can happen. In the situation with Josh Hartly he was unaware of the specifications of the new car that he was interested in purchasing and the salesperson was also unaware as well. As the textbook states, “The validity of a contract may be affected by the fact that one or both of the parties made a mistake.” (Twomey & Jennings, 2014).
Concerning Josh and the salesperson at the auto dealership both parties made a mistake about the specifications of the cars engine. This would be considered a mutual mistake, which happens when both parties enter into a agreement or contract under a mutual mistaken understanding concerning a basic assumption of fact or law on which the contract has been created. When this happens the contract is voidable if the mistake has material effects on the agreed exchange. The mistake made by Josh and the salesperson would render the contract voidable but not by the adversely affected party. In the situation with Josh and the salesperson both parties did not act unethically in this case because they both were unaware that the manufacturer had stopped manufacturing the 3.2 and 3.9-liter engine. Since both parties did not know about these changes in the car they were not acting unethical.
When sales contracts are created under a mutual mistake or fact, I do believe that they should be able to rescind. Everyone is human and mistakes do happen in agreements between people. When this happens and both parties see that the mistake was made they should both have the option to rescind the contract and if the other parties still wants to proceed with a new agreement with the correct information or facts they should have the choice to do that. If the other party does wish to still agree on a new contract then that as well should be a choice that is given to them without any repercussions.