Question

Max Corporation, a well-known television manufacturer, had several odd lots of discontinued models, which it desired to clear out. Max, the president, invited Dharun, the owner of Dharun Discount Chain, to come in and examine the different models and make Max and offer for the entire lot. The sets were segregated from the regular inventory. Fifteen televisions that were not discontinued models were accidentally included in this segregated group by one of Max's employees. Dharun was unaware that max did not intend to include the 15 tv's in the group. Dharun made Max an offer of $10,000 for the entire lot. Unaware of his employee's error, Max accepted Dharun's offer. Max would not have accepted Dharun's offer if Max had known the 15 current models had been included. Upon learning of the error, Max Corporation refused to preform and alleged mistake as defense. Dharun Discount Chain sued Max Corporation for breach of contract. Judgement for whom?

Answer 1

The contract entered into by Max and Dharun was prepared a under a mistake which Max was not aware of, hence the contract is not valid. A contract entered into mistake of facts is not a valid contract since there is no voluntary consent for the contract as it is mentioned that if Max was aware of the mistake he would gave not entered into the contract. Dharun suing Max corporation for breach of contract would not be valid as the contract was made under mistake of which max was not aware. The contract law allows to avoid mistakes if they mistakes are mistake of fact and not of value. Since here the mistake was of the fact which Max was unaware.Therefore, the judgement would be in th favor of max