Why is it important to distinguish between unilateral and mutual mistakes?
A) Because it determines which contracts are considered fraudulent.
B) Because it determines which contracts are voidable.
C) Because it determines which contracts lack consideration.
D) Because it determines how much may be awarded in damages under a contract.
E) Because it determines whether punitive damages may be awarded.

Question

Quizplus · Accepted Answer

Distinguishing between unilateral and mutual mistakes is crucial because it affects whether a contract is voidable. A mutual mistake, where both parties share the same incorrect assumption about a fundamental fact of the contract, can render the contract voidable. In contrast, a unilateral mistake, where only one party is mistaken, generally does not provide a basis for voiding the contract unless specific conditions are met.

Why Is It Important to Distinguish Between Unilateral and Mutual