Rectification
Rectification is a measure used by the courts to amend a written contract
so that it reflects more accurately the parties’ previous oral agreement. This
will be an exception to the general principle of the parol evidence rule (see
Chapter 6) and is available where both parties are mistaken, as in common
mistake, or where one party has let the other continue under a mistake, as
in unilateral mistake. As will be seen in the following cases, the courts will
need clear evidence of the previous oral agreement.
The doctrine of mistake in general
The idea of a doctrine of mistake is still developing and has not met with
universal approval. In many cases it could be argued that it is not really
needed, since the cases could be raised in other areas of contract law,
certainly if these were developed a little. In some instances, as in the cases
of mutual mistake, there is no real agreement. In others, the consideration
does not exist, or a precondition has failed. Yet others could be argued on
the basis of the terms of the contract, as was the situation in McRae.
The case of Sheik v Oschner (1957) is a good example of this overlap
between doctrines, as the parties had contracted over a certain quantity of
a crop, and it was found that it was impossible for the land to produce this
quantity. The contract was found void for mistake, but it could well have
been argued that the contract lacked consideration or that it was frustrated.
The distinction between a claim under the doctrine of frustration and a
claim in mistake often depends solely on the identification of the moment
of contract. This was so in the case of Amalgamated Investment and
Property Co Ltd v John Walker and Sons Ltd (1976), where a purchaser of
a building was mistaken over the value of a building because the building
was ‘listed’ and therefore subject to restrictions. Had the ‘listing’ taken
place before the contract the claim may have succeeded in mistake, but in
fact the ‘listing’ occurred after the point of contract.
196 Contract law
Joscelyne v Nissen (1970)
An agreement was formed between a father and daughter whereby he
handed over the business in return for her paying certain bills. A
dispute arose when some bills were not paid, and on investigation the
written agreement was found not to contain any reference to payment
of the bills. However, it was rectified because of the evidence of regular
payments having been made so far by the daughter.