Учебный год 22-23 / W_W_BUCKLAND_AND_ARNOLD_D_McNAIR_ROMAN_LA

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English law treats mistake of the former kind as going to motive, and therefore as irrelevant for purposes of mistake, unless the mistake amounts to thinking that the subject-matter of the contract existed whereas in fact it did not. Perhaps a mistake common to both parties as to the identity of the subject-matter has the same effect. Of course mistake inducing consent may be very relevant if induced by the other party, whether fraudulently or innocently, but in either case the contract will become voidable, not void, and innocent third parties who have acquired goods by reason of the contract will be protected.

It still seems correct1 to say that a mistake of the second kind (i.e. one which excludes consent) is relevant only if the other party knew of the mistake, or perhaps if he ought to have known of it. If he did not know of the mistake then the parties are genuinely at cross purposes, and the view that the law takes of the resulting situation is that the Court must try to ascertain the sense of the contract, and for that purpose will ask what meaning would be given to it by a reasonable man. This may end in imposing upon the two parties a contract which is different from what either of them meant, but the method will usually work and will at any rate preserve almost all contracts from failing. However, in a few very exceptional cases the Court will find itself unable to give a clear and definite meaning to the contract because there is some latent ambiguity which cannot be resolved, even by the admission of oral evidence.2 But if a definite meaning can be given to the contract, then neither party will be allowed to slide away from it on the ground of mistake, unless his mistake was known to the other party.

There still remains the question what kind of mistake excluding consent will be treated as relevant, even when known to the other party. This question3 has never been

properly worked out. Perhaps the majority of cases can be left to take care of themselves on the ground that they are comparatively unimportant or that mistakes as to some minor point in the contract would be very unlikely to be known to the other party. All one can say, for the moment, is that mistakes as to the identity of the other party or of the object of the contract, or as to the existence or nonexistence of some express term, have been declared to be relevant, and that probably a mistake known to the other party as to the price would also be considered relevant; but it seems unlikely that the Courts would go much further.

The non estfactum cases undoubtedly cause difficulties in formulating a law of mistake in contract; for in none of them was the party seeking to hold the mistaken party to the contract aware of his mistake, and yet in several of them he failed. I think that quite a fair defence can be made for some of these decisions and even for the decision in Carlisle and Cumberland Banking Co. v. Bragg.1 In all the cases in which effect has been given to the doctrine a fraudulent person has been careful not to bring the parties to the contract face to face, but to constitute himself a messenger of a document which he has induced the one party mistakenly to execute in favour of the other party. It may be thought that the law would have been better had the Court in Bragg's Case held that Bragg must pay for his carelessness in executing the guarantee, but there may also be some doubt whether it was altogether businesslike of the bank to act upon the supposed guarantee without communicating with Bragg. It is perhaps not unreasonable to say that a party who acts upon a document purporting to be signed by somebody not in his presence should take the risk of its turning out to be something other than it purports to be, and it is not unreasonable that some distinction should be made between negotiable instruments

1 [1911] 1 K.B. 489.

ville Williams has shown,1 identity is only determined by a combination of attributes; thus English law is in fact bound to take notice of attributes if they are so important as to determine identity. However, there is no doubt whatever that the English law of mistake always looks beyond the attributes to the resulting identity; but it would be quite possible for a law, while regarding a mistake as to identity as the only relevant mistake, to concentrate on the mistaken attributes which led to the mistake of identity, and if it did so, there might well be a tendency to say that any attributes which determined the substance of the thing were relevant even though they did not actually determine its identity. It is quite possible that this is the way the Roman jurists approached the problem of error in substantia.

Nevertheless the doctrine seems to us dangerous, and it is no great consolation to be told that in any case the Roman law of contract placed much greater emphasis than English law on actual consensus and left very little room for the notion of reliance on the other party's words and acts. In practice the two laws were probably not so far apart. Let us take for instance a case like Smith v. Hughes.2 English law lays emphasis upon two separate points: it says that in any case the contract would not be void against Smith if he did not know of the mistake, and secondly that even if he did know of the mistake, the mistake would be irrelevant unless it was as to a term of the contract, and not merely as to an attribute of the thing sold. As to the first point, the only definite rule we find in Roman law is that the mistake will not be relevant if it is clearly due to the mistaken party's own fault. That would cut out most of the cases; but further, the party alleging mistake would surely have had to prove his mistake. How could he do it to the satisfaction of the judge ? In most cases he would have to show that the price he had agreed to pay was intelligible

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upon the basis of the mistaken attribute, but not otherwise. But if he could prove so much, the inference would be almost inevitable in many cases that the other party knew or ought to have known of the mistake. There would still however remain some cases where one party could convince the judge that he had been mistaken, but not that the other party had known of his mistake; and in these cases Roman law would treat the contract as void, whilst English law would treat it as valid.

On the second point there is an undoubted difficulty: Roman law does not make any clear distinction between a mistake as to an attribute and a mistake as to a term, or, to put the distinction as it arose in Smith v. Hughes^ between a quality and a promised quality. As to this, two particular points may be made: the first is that the English distinction must be very difficult to draw in practice, and a judge or jury faced with evidence which seemed to point to a mere mistake as to an important attribute would be inclined to scent fraud if the other party had been aware of it, and would very probably take the short additional step of finding that the mistake went beyond the mere attribute and extended to an actual term of the contract—in other words, that the mistaken party thought, not merely that the thing he would get had a particular attribute, but that the other party was promising that attribute. The second point is that the Roman solution is very much in line with the Roman treatment of liability for secret defects of quality. If the rule is, as in English law, caveat emptor, then the corollary is that, leaving on one side the implied conditions in the Sale of Goods Act, I must bargain specially for every quality that I want the subject-matter of the contract to possess, and inevitably the only sort of mistake that will be relevant will be one that relates to whether I have successfully bargained for the quality or not. But in Roman law the position was quite different.

1 (I8 7 I),L . R . 6Q . B . 597.

Whatever may have been the limits of the implied warranties of quality in classical law, the whole atmosphere of the contract of sale (which is alone in question in these cases) is one of good faith. A buyer is entitled to assume that a seller will deliver goods of proper quality, and of the kind which he is likely to want. No doubt the parties are entitled to overreach each other as regards price, but the whole atmosphere of the contract is against such overreaching in respect of the nature or quality of the goods. In these circumstances it would be unreasonable to place the requirements of mistake as high as in English law. One cannot go so far as to say that a buyer is always entitled to expect that the goods shall be of precisely the kind that he wants, but it will not be unreasonable to say that he can treat the sale as void if he was mistaken as to some very important quality.

For we must always remember that it is not every attribute that goes to the substance of a thing. Whatever the correct meaning to be given to the word 'substance*—and it is admitted on all hands that there is great obscurity here— it is quite clear that it must be something very important.

This juxtaposition of error in substantia and the liability for secret defects ofquality is not fanciful. In modern French law they are regularly confused, and in many cases where a buyer is unable, e.g. owing to lapse of time, to use his remedy for secret defects, and the defect proves to be serious enough to be considered one of substance, an attempt is made to treat the sale as voidable for error in substantia}

At first sight another difference seems to exist between Roman and English law, for although no criterion of substantia has been found to satisfy all critics, it seems at any rate to have had some connexion with the nature of the thing itself, which is the subject-matter of the contract. On the other hand there seems to be no reason why a contract should not be treated as void in English law,

1 52 L.^.R. 99.

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3. POSITION OF THIRD PARTIES

Both the Roman and the English law have the principle that a third party cannot be liable or entitled under a contract, and the Roman law had not the conception of agency, which lessens the field of application of the rule in our law. But both systems have found the rule inconvenient, at least as to the acquisition of rights by third parties, and have circumvented it in different ways. In Roman law the method is not systematic: an equitable action {actio utilis) was given to the third party in a number of cases in which justice or convenience seemed to require it. We do not know how the action was formulated—in many cases it is later than the abolition of the formulary system—but the fact that it is an equitable action and not a direct action on the contract shows that it is in no way meant to break with the principle that third parties cannot acquire rights under contracts. In our system the trust principle is invoked with very similar results. Where the Court thinks that justice requires that third parties should have a remedy it constructs a trust in their favour, even though the parties to the contract have not used the language usually associated with trusts; but it must be admitted that the occasions on which the Courts have been willing to do this have been very rare. In the United States a different road has been followed. Disapproval has been expressed with our way of dealing with the matter: the trust, it is said, is a figment, and we are in fact giving rights to third parties under the contract, but in an unnecessarily clumsy way.1 American Courts prefer not to use this device (though at least one jurisdiction resorts to 'equity procedure* for the purpose), but to say that there are cases in which a third party can acquire rights under the contract. It is however clear that the rule cannot be that in every case in which a third party is an intended

1 See, e.g., Corbin, 46 L.Q.R. (1930) pp. 12 sqq.