Harry owns a Cadillac and a Porsche. Ryan has always wanted a Porsche and knows Harry owns one. Harry decides to sell his Cadillac and buy a BMW. A mutual friend of Ryan and Harry tells Ryan, "Harry's selling his car." Thinking Harry is selling the Porsche (he does not know he also has a Cadillac), Ryan calls Harry and says, "I'll give you $9,500 for your car." Harry, thinking Ryan is talking about the Cadillac, says, "You've got a deal." On what grounds is the above agreement open for rescission?

Question

Quizplus · Accepted Answer

A mutual mistake is one where both parties were acting under a mistaken belief about a material fact. Mutual mistake can arise in many different ways. As in this case, the parties were mistaken about the subject matter of their agreement. Obviously, there was no meeting of the minds in this case and the agreement is open to rescission.

Harry Owns a Cadillac and a Porsche