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130 Chapter 4Misrepresentation, mistake, duress and illegality

insurers refused to pay, arguing mistake as to the person. The contract was not void for

mistake. It was true that the parties did not meet face to face and that the claimant was

mistaken about the identity of the other contracting party. The contract was not void for

mistake, however, because the claimant would not have been bothered which of the two

insurance companies made the contract of insurance.

Mistake as to the nature of what is being signed

If a person signs a document while making a complete mistake as to what type of document

is being signed then the contract can be void for a type of mistake knows as non est factum

(it is not my deed).

Non est factumcannot be claimed by a person who was careless in signing. In United

Dominions Trust Ltd vWestern (1975)the Court of Appeal therefore held that it was not

available to a person who signed a blank document for the figures to be filled in later.

FostervMackinnon (1869)provides a rare example of a successful plea of non est factum.

An old man with very poor eyesight signed a document which he was told was a guarantee.

In fact, the document was a cheque. Non est factumapplied and the old man was not liable

on the cheque.

Undue influence

Duress

Traditionally, a contract was voidable for duress only if one of the parties was forced into

making it by the threat of illegal physical violence. This common law doctrine was so

narrow as to be virtually useless. A person who makes a contract because of such threats is

unlikely then to go to court to avoid the contract.

More recently, a doctrine of economic duress has developed. A threat of physical violence

is no longer necessary. Now a party who was pushed into a contract in such a way that there

Saunders vAnglia Building Society (1970) (House of Lords)

An elderly woman intended to leave her house to her nephew after her death. The nephew

owed money to one Lee. To pay Lee off the nephew visited the elderly aunt with Lee, who

asked the elderly woman to sign a document. Lee told her that this gave the house to the

nephew but that she would be allowed to live there for the rest of her life. In fact, the docu-

ment said that Lee had bought the house and paid for it. The elderly woman did not read

the document because her glasses were broken. Lee mortgaged the house to the Anglia

Building Society but did not pay any of the mortgage instalments. The building society

applied to repossess the house.

HeldThe contract was not void for non est factumbecause there was not a fundamental

difference between what the elderly woman signed and what she thought she was signing.

(Either way she was transferring her ownership of the house.) Therefore, the contract was

valid and the building society could repossess the house.