Smith v Hughes
One party's mistake about the quality of the goods, not induced by the other party, does not affect the contract.
Facts
Mr Smith, a farmer, offered to sell oats to Mr Hughes, a racehorse trainer, and showed him a sample. Mr Hughes agreed to buy 40 or 50 quarters of oats at 34s a quarter. When the oats were delivered, Mr Hughes found that they were new oats, which were no use for his horses, and refused to accept them. He claimed that he had believed he was buying old oats, and that the word old had been used during the negotiations. The judge directed the jury that they should find for Mr Hughes if the farmer knew that Mr Hughes believed he was buying old oats, and the jury found for Mr Hughes.
Legal principle
The Court of Queen's Bench ordered a new trial, holding that the jury had been misdirected. If Mr Hughes merely believed that the oats were old, and the farmer knew of that belief but had not induced it, the contract was valid: the seller is under no legal duty to correct the buyer's mistaken belief about the quality of the goods, under the principle of caveat emptor, let the buyer beware. The position would be different if Mr Hughes believed that the farmer was contracting to sell old oats, and the farmer knew this, because then the parties would not have agreed on the same terms. Blackburn J's statement of the objective test of agreement is often quoted: if a man so conducts himself that a reasonable man would believe he was assenting to the terms proposed, he is bound as if he had intended to agree.
Related cases on mistake
- Associated Japanese Bank (International) Ltd v Crédit du Nord SA [1989] 1 WLR 255
- Bell v Lever Brothers Ltd [1932] AC 161
- Couturier v Hastie (1856) 5 HLC 673
- Cundy v Lindsay (1878) 3 App Cas 459
- Great Peace Shipping Ltd v Tsavliris Salvage (International) Ltd [2002] EWCA Civ 1407, [2003] QB 679
- Hartog v Colin & Shields [1939] 3 All ER 566
- Ingram v Little [1961] 1 QB 31
- Lewis v Averay [1972] 1 QB 198
Studying contract law? Our tutors help you understand and apply cases like this in essays, problem questions and exams. Request a quote or browse our law notes.
This summary is for study and revision and is not legal advice. Although our case summaries are checked for accuracy, we do not guarantee that they are free from errors or omissions. Always read the full judgment for the court's reasoning.
