Mistakes We may also mention that there is no jurisdiction to set in award. aside an award, or refer it back to the arbitrator, on the Special cases where ground of a mistake in fact or law, unless the arbitrator admits the mistake and desires the assistance of the Court to rectify it, or unless there is an actual excess of jurisdiction (r). What then are the special classes of cases in which mistake is of importance, and which have given rise to mistake is the language held by our books on the subject? They are believed to be as follows. of im portance. 1. As ex cluding true consent. 2. In ex true 1. Where mistake is such as to exclude real consent, and so prevent the formation of any contract, there the seeming agreement is void. Of this we shall presently speak at large (Part 2 of this chapter). 2. Where a mistake occurs in expressing the terms of a pressing a real consent, the mistake may be remedied by the equitable consent. jurisdiction of the Court. Of this also we shall speak separately (Part 3). 3. Renun rights. 3. A renunciation of rights in general terms is underciation of stood not to include rights of whose actual or possible existence the party was not aware. This is in truth a particular case under No. 2. 4. Payment of money. All these exceptions may be considered as more apparent than real. 4. Money paid under a mistake of fact may be recovered back. This is a real exception, and the most important of all. Yet even here the legal foundation of the right is not so (r) Dinn v. Blake, L. R. 10 C. P. 388. An arbitrator cannot of his own motion correct even a manifest clerical error in his award after signing it: he should apply to the Court: Mordue v. Palmer, 6 Ch. 22. much the mistake in itself as the failure of the supposed consideration on which the money was paid. B. Mistake of Fact and of Law. B. Mistake of Fact It is an obvious principle that citizens must be presumed and of for all public purposes to know the law, or rather that they Law. cannot be allowed to allege ignorance of it as an excuse. As has often been said, the administration of justice would otherwise be impossible. Practically the large judicial discretion which can be exercised in criminal law may be trusted to prevent the rule from operating too harshly in particular cases. On the other hand it would lead to hardship and injustice not remediable by any judicial discretion if parties were always to be bound in matters of private law by acts done in ignorance of their civil rights. There is an apparent conflict between these two principles which has given rise to much doubt and discussion (8). But the conflict, if indeed it be not merely apparent, is much more limited in extent than has been supposed. the dis cable. It is often said that relief is given against mistake of How far fact but not against mistake of law. But neither branch tinction of the statement is true without a great deal of limitation appliand explanation. We have already seen that in most transactions mistake is altogether without effect. There, of course, the distinction has no place. Again, there are the many cases where, as we have pointed out above, (8) Savigny, followed by Vangerow and other later writers, strikes out a general rule thus: Where mistake is a special ground of relief (and there only), the right to such relief is excluded by negligence. Ignorance of law is presumed to be the result of negligence, but the presumption may be rebutted by special circumstances, e. g. the law being really doubtful at the time. There is much to be said for this doctrine on principle, but it will not fit English law as now settled on the most important topic, viz. recovering back money Where common mistake excludes ment, of private all events = rance of fact. knowledge or notice is a condition precedent to some legal consequence. By the nature of these cases it generally if not always happens that the subject-matter of such knowledge, or of the ignorance which by excluding it excludes its legal consequences, is a matter of fact and not of law. The general presumption of knowledge of the law does so far apply, no doubt, that a person having notice of material facts cannot be heard to say that he did not know the legal effect of those facts. All these, however, are not cases of relief against mistake in any correct sense. Then come the apparent exceptions to the general rule, which we have numbered 1, 2, and 3. As to No. (1) it is at least conceivable that a common mistake as to a quesreal agreetion of law should go so completely to the root of the ignorance matter as to prevent any real agreement from being formed. right at It is laid down by very high authority "that a mistake or igno- ignorance of the law forms no ground of relief from contracts fairly entered into with a full knowledge of the facts" (t) but this does not touch the prior question whether there is a contract at all. On cases of this class English decisions go to this extent at all events, that ignorance of particular private rights is equivalent to ignorance of fact (u). As to No. (2) the principle appears Rectifica- to be the same. A. and B. make an agreement and instruct C. to put it into legal form. C. does this so as not to express the real intention, either by misapprehension of the instructions or by ignorance of law. It is obvious against that relief should be equally given in either case. draftsman neither is there any reason for holding the parties to a though contract they did not really make. not tion of instruments: relief given mistake of (t) Bank of U. S. v. Daniel (Sup. Ct. U.S.) 12 Peters, 32, 56. Common mistake as to a collateral matter of law does not of course avoid a contract: Eaglesfield v. Marquis of Londonderry, 4 Ch. D. 693. (u) Bingham v. Bingham, 1 Ves. Sr. 126, Broughton v. Hutt, 3 De G. & J. 501, Cooper v. Phibbs, L. R. 1 H. L. 149, 170; of which cases a fuller account is given below. deliberate ties as to of instru Authority, so far as it goes, is in favour of what is here against a advanced (r). There is clear authority that on the other choice of hand a court of equity will not reform an instrument by the parinserting in it a clause which the parties deliberately agreed form or to leave out (y), nor substitute for the form of security the contents parties have chosen another form which they deliberately ments. considered and rejected (r), although their choice may have been determined by a mistake of law. The reason of these decisions, however, is that in such cases the form of the instrument, by whatever considerations arrived at, is part of the agreement itself and so beyond the power of the Court. tion of as to com abandon As to No. (3), there is quite sufficient authority to show Renunciathat a renunciation of rights under a mistake as to par- rights: ticular applications of law is not conclusive, and some distinction authority to show that it is the same even if the mistake promise or is of a general rule of law. The deliberate renunciation deliberate or compromise of doubtful rights is of course binding; it ment. would be absurd to set up ignorance of the law as an objection to the validity of a transaction entered into for the very reason that the law is not accurately known (z). A compromise deliberately entered into under advice, the party's agents and advisers having the question fully before them, cannot be set aside on the ground that a particular point of law was mistaken or overlooked (a). Conduct equivalent to renunciation of a disputed right is equally binding, at least when the party has the question fairly before him. Thus in Stone v. Godfrey (b) the plaintiff had been advised on his title unfavourably indeed, but in such a way as to bring before him the nature of the question. and give him a fair opportunity of considering whether he should raise it. Adopting, however, the opinion he had obtained, he acted upon it for a considerable time, and in (x) Hunt v. Rousmaniere's Adm. (Sup. Ct. U. S.) 1 Peters, 1, 13, 14. (y) Lord Irnham v. Child, 1 Bro. C. C. 92. (z) Cp. the remarks on compro mises in Ch. IV., p. 181, above. (a) Stewart v. Stewart, 6 Cl. & F. 911; see the authorities reviewed, pp. 966-970. (b) 5 D. M. G. 76, Money paid by mistake a manner which amounted to representing to all persons interested that he had determined not to raise the question. It was held that although the mistake as to title might in the absence of such conduct well be a ground of relief, a subsequent discovery that the correctness of the former opinion was doubtful did not entitle him to set up his claim anew. In Rogers v. Ingham (c) a fund had been divided between two legatees under advice, and the payment agreed to at the time. One of the legatees afterwards sued the executor and the other legatee for repayment, contending that the opinion they had acted upon was erroneous; it was held that the suit could not be maintained. Similarly where creditors accepted without question payments under a composition deed to which they had not assented, and which, as it was afterwards decided, was for a technical reason not binding on nonassenting creditors, it was held that they could not afterwards treat the payments as made on account of the whole debt and sue for the balance. They might have guarded themselves by accepting the payments conditionally, but not having done so they were bound (d). In Re Saxon Life Assurance Society (e) it was held that a creditor of a company was not bound by a release given in consideration of having the substituted security of another company, which security was a mere nullity, being given in pursuance of an invalid scheme of amalgamation. Here the mistake was obviously not of a general rule of law; and perhaps the case is best put on the ground of total failure of consideration (f). As to No. (4), the subject of recovering back money paid by mistake does not properly fall within our scope. (e) 3 Ch. D. 351 (Hall, V.-C. and C. A.) (d) Kitchin v. Hawkins, L. R. 2 C. P. 22. (e) 2 J. & H. 408, 412 (the Anchor ca.). (f) In the former editions some remarks were made on M'Carthy v. Decaix, 2 Russ. & My. 614, as raising a difficulty in this connexion. As that case is no longer of authority (see Harvey v. Farnie, 8 App. Ca. 43, 52, 60, 63), they are now omitted. |