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In a contract both the parties believe that the subject matter of the contract is in existence but which is infect not in existence. Agreement shall be:
- a)Valid
- b)Void
- c)Void due to bilateral mistake
- d)Void due to unilateral mistake
Correct answer is option 'C'. Can you explain this answer?
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In a contract both the parties believe that the subject matter of the ...
Validity of a Contract
A contract is an agreement between two or more parties that creates a legal obligation to perform some duties or obligations. For a contract to be valid, it must have the following elements:
1. Offer - An offer is a proposal made by one party to another to enter into a contract.
2. Acceptance - Acceptance is the agreement by the other party to the terms of the offer.
3. Consideration - Consideration is the exchange of something of value by both parties.
4. Competent parties - The parties to the contract must be legally competent to enter into the contract.
5. Legal purpose - The object of the contract must be legal.
Void Due to Bilateral Mistake
When both parties to the contract misunderstand the subject matter of the contract, the agreement is known as a bilateral mistake. In such a case, the contract is voidable. It means that either party can request the contract to be rescinded or cancelled. The reason for this is that there is no meeting of the minds between the parties. The contract is based on a mutual misunderstanding of the subject matter.
Void Due to Unilateral Mistake
When one party to the contract misunderstands the subject matter of the contract, the agreement is known as a unilateral mistake. In such a case, the contract is still valid. However, the party that made the mistake may have the right to rescind or cancel the contract if the other party knew or should have known of the mistake.
In the given scenario, since both parties believed that the subject matter of the contract was in existence but it was actually not in existence, it is a case of bilateral mistake. Therefore, the agreement shall be void due to bilateral mistake.
A contract is an agreement between two or more parties that creates a legal obligation to perform some duties or obligations. For a contract to be valid, it must have the following elements:
1. Offer - An offer is a proposal made by one party to another to enter into a contract.
2. Acceptance - Acceptance is the agreement by the other party to the terms of the offer.
3. Consideration - Consideration is the exchange of something of value by both parties.
4. Competent parties - The parties to the contract must be legally competent to enter into the contract.
5. Legal purpose - The object of the contract must be legal.
Void Due to Bilateral Mistake
When both parties to the contract misunderstand the subject matter of the contract, the agreement is known as a bilateral mistake. In such a case, the contract is voidable. It means that either party can request the contract to be rescinded or cancelled. The reason for this is that there is no meeting of the minds between the parties. The contract is based on a mutual misunderstanding of the subject matter.
Void Due to Unilateral Mistake
When one party to the contract misunderstands the subject matter of the contract, the agreement is known as a unilateral mistake. In such a case, the contract is still valid. However, the party that made the mistake may have the right to rescind or cancel the contract if the other party knew or should have known of the mistake.
In the given scenario, since both parties believed that the subject matter of the contract was in existence but it was actually not in existence, it is a case of bilateral mistake. Therefore, the agreement shall be void due to bilateral mistake.
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In a contract both the parties believe that the subject matter of the ...
The agreement is void where there is a bilateral mistake as to the possibility of performance in other words where the parties to an agreement believe that the agreement is capable of performance, while infact it is not so, the agreement is treated as void. The impossibility may either be physical or legal
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In a contract both the parties believe that the subject matter of the contract is in existence but which is infect not in existence. Agreement shall be:a)Validb)Voidc)Void due to bilateral mistaked)Void due to unilateral mistakeCorrect answer is option 'C'. Can you explain this answer?
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