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What is an example of a mutual mistake that can void a contract?

If both contracting parties make a mistake regarding facts considered to be material, the party that is negatively affected may get out of the contract. This will typically arise when there is a lack of existence of the subject matter. Mutual mistake can either result in a void or voidable contract.

Below is an example of mutual mistake where the contract is automatically void:


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  • What are some of example of why a contract is void?

    A void contract is a formal agreement that is effectively illegitimate and unenforceable from the moment it is created. Some examples of why a void contract would exist include fraud in the execution, physical duress, illegality, adjudicated incompetency, and mutual mistake.

  • What is an example of physical duress?

    Physical duress is one of the reasons a contract can be automatically void. Physical duress will arise when one party physically harms or threatens the victimized party with physical force. Below is a list of reasons a contract is void or could be voidable!

  • What is illegality for void contracts?

    Illegality occurs if the considerations within the contract is considered legal. If illegality is present, then the contract is automatically void. Below is an example of illegality: