ABSTRACT
There is no such entity as a doctrine of mistake. Instead, the situations in which a contract will be nullified or capable of rescission for mistake are contained in a disparate group of cases. A mistake which renders a contract void is described as an ‘operative’ mistake. A mistake as to law, as opposed to a mistake of fact, will not be operative. At common law the effect of an operative mistake is generally to make the contract void ab initio. In such a case it does not matter how blameless the parties are or how the mistake arose. No obligations can arise under such a contract, nor can arise under such a contract, nor can title in goods pass. In equity, on the other hand, a contract affected by mistake may be voidable at the option of the party who is mistaken. Until the mistaken party chooses to avoid the contract properly will pass and obligations arise. However, the right to rescind may be lost if the subject matter of a contract affected by mistake has passed to a bona fide purchaser for value without notice of the circumstances of the mistake.
