FLK1 · Contract

Mistake

SQE1 revision notes — the key rules, leading cases and common traps for this topic, in plain English and current to 2026.

CON.07 — Mistake (Contract, FLK1)

Mistake is narrow. Most cases that feel like "mistake" are really misrepresentation, frustration, or just a bad bargain. An operative mistake renders the contract void from the outset (no rights pass; relevant for third parties and title). Equity historically gave wider, more flexible relief, but that has been heavily cut back.

Categories

1. Common mistake — both parties share the same wrong belief.

  • Res extincta: subject matter doesn't exist (Couturier v Hastie; now codified — Sale of Goods Act 1979 s.6).
  • Res sua: buyer already owns what they're "buying" (Cooper v Phibbs).
  • Mistake as to quality: very hard to rely on. Must make the thing essentially and radically different from what was contracted for (Bell v Lever Bros — golden-handshake paid to a man who could have been dismissed for free; held not void). Great Peace Shipping v Tsavliris confirms the Bell test and abolished the equitable jurisdiction to rescind for common mistake in Solle v Butcher. So there is no equitable common-mistake relief in England & Wales.

2. Mutual (cross-purposes) mistake — parties at cross-purposes; no consensus. Judged objectively: if a reasonable person could not identify the agreed terms, no contract (Raffles v Wichelhaus — two ships "Peerless").

3. Unilateral mistake — one party mistaken, other knows/induces it.

  • Mistake as to terms: if A knows B is mistaken about a term, no contract (Hartog v Colin & Shields — hare skins priced per lb not per piece).
  • Mistake as to identity: identity must be material and the offeror must intend to deal with a specific other person. Face-to-face dealings carry a strong presumption the seller intends to deal with the person physically present, so the contract is voidable for fraud, not void (Phillips v Brooks; Lewis v Averay; Shogun Finance v Hudson — written contract, no face-to-face dealing, so void). Voidable vs void is decisive for the innocent third-party buyer: title can pass before rescission if only voidable.

Common SBAQ traps

  • Void (mistake) vs voidable (fraud/misrep) — drives whether a third party gets good title.
  • Solle v Butcher equity is dead after Great Peace.
  • Mistake as to quality/value rarely operative — a bad bargain isn't a mistake.
  • Non est factum: very narrow — signer must be radically wrong about the document's nature and not careless (Saunders v Anglia BS).

Try a real SQE1 question

Straight from the bank. Answer it, then see the worked reasoning and the tutor — no signup to try.

In January, a doctor negotiating the sale of his medical practice tells the buyer, truthfully, that the practice generates around £2,000 a month in income. Contracts are not signed until May. Between January and May the doctor falls seriously ill, stops practising, and the patient list collapses, so that by the time of signing the practice earns almost nothing. The doctor says nothing about this change. The buyer, still relying on the January figure, completes the purchase and then discovers the true position.

Before you book a £1,934 exam

Strong on this topic? SQE1 tests 137 of them — and 59% failed in July 2025. See where you stand across all of them, free.

  • ✓An AI tutor on every question that already knows the answer — the part nothing else has
  • ✓5 full mock papers at real exam pace, plus unlimited drilling — no daily cap
  • ✓The whole 2,000+ bank, verified and source-cited to the law, all 137 areas
  • ✓Your weak-spot map: exactly where you’re losing marks
Start my free diagnostic — one tap →

Free. No card. 25 questions, about 15 minutes. Full SQE1 courses run £1,500–£4,000 — this starts at £0.

More Contract topics

See all topics in the FLK1 guide or the full SQE1 syllabus.

Independent SQE1 revision notes for study — not legal advice; check primary sources before relying on any point. Exam rules are set by the SRA; see the official SQE site.