Question

Principle: 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.
Factual Situation: Roxanne supplies designer clothes to big showrooms and famous cloth houses. Max agrees to buy a certain consignment of only pink designer clothes for his shop due to the pink coloured theme of his famous shop. Issue cropped up when the exclusive pink coloured dresses were not delivered to Max's showroom, but to some other buyer, who had earlier contracted with Roxanne's store and all this was neither in the knowledge of Roxanne nor Max Decide whether the contract between Roxanne and Max is void?

• A. Yes, because Roxanne and Max were under a mistake as to matter of fact which is essential to the agreement
• B. No, because Max's agreement was fresh, so it is legally binding
• C. Yes, because an earlier commitment made by store owner to some other buyer is far more relevant than another commitment
• D. Roxanne and Max's contract is valid

Answer 1

Answer: (D)

Roxanne and Max's contract is valid

(d) (d) is correct. An agreement will be binding on both the parties and will remain so until anyone of the violates the terms of the agreement. In the given case what happened between Roxanne and third party does effect the agreement between Roxanne and Max. Further neither of them is planning to violate the terms of agreements so the contract stands valid.
(c) is incorrect as the agreement between Roxanne and some earlier party holds no relevance whatsoever on the validity of agreement between Roxanne and Max.
(b) is also incorrect as validity of agreement does not depend upon its freshness or staleness.
(a) is incorrect. As any commitment with any other party will not be a mistake as to the matter of fact essential to this agreement.