Mistake | Indian Contract Act in Tamil | CA CMA CS Foundation Law Classes in Tamil

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MISTAKE: [Sec. 20, 21 and 22]
Mistake means an erroneous belief about something. It has not been defined in the Indian
Contract Act.
Mistake can be -
(A) Mistake of law, or
(B) Mistake of fact
(A) Mistake of law may be:
(i) Mistake of law of the country
(ii) Mistake of law of a foreign country
(i) Mistake of law of the country:
When a party enters into a contract, without the knowledge of law in the country, the contract is
affected by such mistake but it is not void. A contract is not voidable because it was caused by
a mistake as to any law in force in India. The reason here is that ignorance of law is not an excuse
at all. However if a party is induced to enter into a contract by the mistake of law then such a
contract may be avoided. The principle of ignorance of law is not an excuse.
(ii) Mistake of law of foreign country: Such a mistake is treated as mistake of fact and agreement
is such case is void. Ignorance of foreign law may be excused.
(B) Mistake of fact may be:
(I) a bilateral mistake, or
(II) unilateral mistake
(I) Bilateral mistake
Where both the parties to an agreement are under a mistake as to a matter of fact essential to
the agreement, the agreement is void.
Explanation: An erroneous opinion as to the value of the thing which forms the subject-matter of
the agreement is not to be deemed a mistake as to a matter of fact.
In order to render a contract void due to bilateral mistake the following two conditions must be
met.
(a) Mistake must be mutual: Both the parties must misunderstand each other and should be at
cross purpose.
(b) Mistake must relate to a matter of fact essential to the agreement: What is essential fact of an agreement depends upon the nature of promise in each case
The various types of mistakes falling under bilateral mistakes are as under:
(i) Mistake as to subject matter covers following cases:
(a) Mistake as to existence of subject matter: If both the parties are at mutual mistake as to
existence of the subject matter the agreement is void.
(b) Mistake as to identity of subject matter: It usually happens when both the parties have different subject matter of contract in their mind. The contract is void due to mistake of identify of subject matter.
(c) Mistake as to the quality of the subject matter: If the subject matter is something essentially
different from what the parties thought to be, the agreement is void.
(d) Mistake as to quantity of subject matter: Bilateral mistake as to quantity of subject matter
would render the contract void.
(e) Mistake as to title of subject matter: The agreement is void due to bilateral mistake as to title
of the subject matter.
(f) Mistake as to price of the subject matter: Mutual mistake as to price of the subject matter
would render the agreement void.
(ii) Mistake as to possibility of performance of Contract. Impossibility may be:
(a) Physical impossibility: A contract is void if it is identified to be non-feasible due to physical
factors, like time, distance, height, etc.
(b) Legal impossibility: A contract is void if it provides that something shall be done which as a
matter of law cannot be done.
(II) Unilateral Mistake as to fact:
As per section 22 a contract is not voidable merely because it was caused by one of the
parties to it being under a mistake as to a matter of fact. A unilateral mistake is not allowed as
a defense in avoiding a contract unless the mistakes brought about by another party’s fraud or
misrepresentation.