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Rectification of Contracts

Date: 01/10/2013
Venue: 4 New Square

A contract or other instrument may be rectified either for common mistake or for unilateral mistake. This seminar explores some of the difficult concepts generated by this doctrine.

  • Common mistake arises where both parties proceed on the same mistaken assumption. There are some important and difficult rules as to the extent to which both parties have to share the same mistake.
  • Unilateral mistake requires evidence that the party seeking to take advantage of the other party’s mistake is not behaving honestly and reasonably. This is a difficult concept: an honest man who suspects that the other party is making a mistake would speak up; a reasonable businessman might keep quiet.
  • Rectification by trustees: the so-called rule in Hastings-Bass used to be a “get out of jail free” card for negligent professionals, enabling trustees to set aside powers of appointment executed under a mistaken belief as to their tax effect. However, the C.A. in Pitt v. Holt recently held that no such rule exists.
  • The classic statement is that the duty to mitigate does not require a claimant to embark on a difficult rectification claim, even if the defendant or its insurers offer an indemnity as to costs. However, the modern position is somewhat more nuanced.

4 New Square offers speakers for in-house training programmes. Some of the current seminar topics are listed below but seminars can be tailored to the client’s requirements. Please contact Georgie Ruane via or direct line 0207 822 2055.

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