mistake,n.1. An error, misconception, or misunderstanding; an erroneous belief. See ERROR. 2.Contracts. The situation in which either (1) the parties to a contract did not mean the same thing, or (2) at least one party had a belief that did not correspond to the facts or law. • As a result, the contract may be voidable. [Cases: Contracts 93. C.J.S. Contracts §§ 136, 147–148.]
“In this Restatement the word ‘mistake’ is used to refer to an erroneous belief. A party’s erroneous belief is therefore said to be a ‘mistake’ of that party. The belief need not be an articulated one, and a party may have a belief as to a fact when he merely makes an assumption with respect to it, without being aware of alternatives. The word ‘mistake’ is not used here, as it is sometimes used in common speech, to refer to an improvident act, including the making of a contract, that is the result of such an erroneous belief. This usage is avoided here for the sake of clarity and consistency. Furthermore, the erroneous belief must relate to the facts as they exist at the time of the making of the contract. A party’s prediction or judgment as to events to occur in the future, even if erroneous, is not a ‘mistake’ as that word is defined here. An erroneous belief as to the contents or effect of a writing that expresses the agreement is, however, a mistake. Mistake alone, in the sense in which the word is used here, has no legal consequences. The legal consequences of mistake in connection with the creation of contractual liability are determined by [substantive rules].” Restatement (Second) of Contracts § 151 cmt. a (1979).
“The word mistake is generally used in the law of contracts to refer to an erroneous belief — ‘a belief that is not in accord with the facts.’ To avoid confusion, it should not be used, as it sometimes is in common speech, to refer to an improvident act, such as the making of a contract, that results from such an erroneous belief. Nor should it be used, as it sometimes is by courts and writers, to refer to what is more properly called a misunderstanding, a situation in which two parties attach different meanings to their language.” E. Allan Farnsworth, Contracts § 9.2, at 619 (3d ed. 1999) (quoting Restatement (Second) of Contracts § 151 (1979)).
basic mistake.A mistake of fact or of law constituting the basis on which a transaction rests.
bilateral mistake.See mutual mistake (1). common mistake.See mutual mistake (2).
essential mistake.Contracts. A mistake serious enough that no real consent could have existed,
so that there was no real agreement. [Cases: Contracts 93. C.J.S. Contracts §§ 136, 147–148.] inessential mistake.See unessential mistake.
mistake of fact. 1. A mistake about a fact that is material to a transaction; any mistake other than a mistake of law. — Also termed error in fact; error of fact. [Cases: Contracts 93. C.J.S. Contracts §§ 136, 147–148.] 2. The defense asserting that a criminal defendant acted from an innocent misunderstanding of fact rather than from a criminal purpose.
mistake of law. 1. A mistake about the legal effect of a known fact or situation. — Also termed error in law; error of law. [Cases: Contracts 93(4). C.J.S. Contracts § 150.] 2. The defense asserting that a defendant did not understand the criminal consequences of certain conduct.
• This defense is generally not as effective as a mistake of fact.
mutual mistake. 1. A mistake in which each party misunderstands the other’s intent. — Also termed bilateral mistake. [Cases: Contracts 93(5). C.J.S. Contracts §§ 149, 155.] 2. A mistake that is shared and relied on by both parties to a contract. • A court will often revise or nullify a contract based on a mutual mistake about a material term. — Also termed (in sense 2) common mistake. [Cases: Contracts 93(5); Reformation of Instruments 19. C.J.S. Contracts §§ 149, 155;
Reformation of Instruments §§ 29–30.]
“The term ‘common mistake’ is more usually, but less grammatically, referred to as ‘mutual mistake’. Cheshire and Fifoot on Contract have made a heroic effort to introduce and establish the more correct term, and it does seem to be gaining ground. However, the beginner is warned that the term ‘mutual mistake’ is nearly always used by the Courts to mean what we here call ‘common mistake’.” P.S. Atiyah, An Introduction to the Law of Contract 190 n.7 (3d ed. 1981).
nonessential mistake.See unessential mistake.
unessential mistake.Contracts. A mistake that does not relate to the nature of the contents of an agreement, but only to some external circumstance, so that the mistake has no effect on the validity of the agreement. — Also termed inessential mistake; nonessential mistake; collateral mistake. [Cases: Contracts 93. C.J.S. Contracts §§ 136, 147–148.]
unilateral mistake.A mistake by only one party to a contract. • A unilateral mistake is generally not as likely to be a ground for voiding the contract as is a mutual mistake. [Cases: Contracts 93. C.J.S. Contracts §§ 136, 147–148.]
[Blacks Law 8th]