Which of the following constitute a mutual mistake of a material fact?
A)Martha selling her house to Graham and hiding the fact that its first floor is damaged
B)Martha and Graham agreeing on the sale of a house, both referring to different houses
C)Graham buying a house from Martha without asking her details of damages
D)Martha selling Graham an old vase for $20, both of them unaware that it is a valuable antique collectible

Question

Quizplus · Accepted Answer

A mutual mistake of a material fact occurs when both parties are mistaken about a crucial fact relevant to the contract. In option B, Martha and Graham are referring to different houses, which is a mutual mistake of a material fact. In option A, Martha is intentionally hiding a fact, which would constitute fraud. Option C does not involve a mutual mistake, as Graham had the opportunity to inquire about damages. Option D involves a mistake, but not a mutual one, as Martha is aware of the vase's true value.

Which of the Following Constitute a Mutual Mistake of a Material