Identity In Contract and The Pothier Fallacy

Abstract

A FURTHER paper on the effect of mistake as to identity on the formation of contract would appear superfluous were it not for the fact that previous surveys of the subject have revealed numerous anomalies which have never been adequately explained. These anomalies appear to have been created artificially by a p-iori reasoning, and the present contention is that the majority of them could be removed by adopting a different approach to the definition of mistake. The object of this paper is t o formulate such a new definition based on the authority of decided cases, and to reassess the value of the much-criticised test of Pothier.Previous attempts to rationalise the cases on this topic have equated mistake as to identity with a positive intention to make a contract with a person other than the one with whom the contract a t issue apparently has been concluded. Thus Mr. Tylor has argued that an apparent contract with B is void, not because A did not intend to deal with B, but because he intended to deal with C, a third identifiable party. Similarly Dr. Cheshire and Mr. Fifoot state that " An agreement apparently concluded between A and B is a nullity on the ground of mistaken identity, if it is proved: (i) that A did not intend to contract with R but with C ; and (ii) that this fact was known, either actually or inferentially, to B." Objections t o the accepted testWith all deference to the learned writers, it is submitted that this approach to the problem is wrong. First, it confuses a method of proving mistake with the fact of mistake itself. Mistake does not lie in proof of an intention to deal with C, but rather in the absence of an intention to deal with B, i.e., lack of the consent requisite to create the contractual tie. The introduction of the third identifiable person is merely useful as a method of proving the fact of mistake (Le., no intention to deal with B) and must not be regarded as the basis of mistake, for it is wrong to regard a method of proving a fact as equivalent to the fact itself.Secondly, it imposes artificial limits to the doctrine of mistake, with the result that half the decided cases on the subject have to be rejected. Thirdly, it results in some curious anomalies. Thus if A consistently refuses to deal with B, but B finally obtains the 1 11 M.L.R. 257 at p. 260.2 Cheshire and Fifoot, Law of Contract, 3rd ed., at p. 197.