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Contract and Legally Binding Agreement

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Contract and Legally Binding Agreement
HARTLY AND THE AUTO DEALER

Tameeka Brown
Hartly and The Auto Dealer
Southern New Hampshire University
October 20, 2013

Hartly & The Auto Dealer

What do you think about this situation? Should parties to a sales contract be able to rescind a contract because of mutual mistake of fact? Why or why not? Did either party act unethically in this case? Why or why not? What application does the UCC have here? Finally, in the overall context of contract law, are there any winners or losers when a contract is rescinded based on mutual mistake of fact? Why or why not?

In my studies of the case, I read about Sherwood verses Walker in the case of Rose the cow. In brief Walker was selling Rose to Sherwood for $80.00 because Walker believed Rose was barren. Sherwood agreed to purchase Rose for this price because he believed Rose to be barren as well. Rose’s value would have been at least 9 to 12 times greater if either party at the time knew she wasn’t barren. As time went on Walker discovered that Rose infact could have a liter and at the time of agreement she was actually pregnant. As a result, Walker declines the agreement between him and Sherwood. Sherwood sued for custody of the animal and won (Twomey & Jennings, 2012 p.286).

Just in my initial analysis I would think the car salesman would apologize for the error and offer to rescind the contract. The contract was created and executed on the belief that both the 3.2 and 3.9 engines were still in use by the manufacture of this particular vehicle. By good nature my first thoughts would be that salesman and the customer would work out an agreement on another vehicle especially since the vehicle of sale would not be available in the future.

On the other hand the customer or the salesman could stick to the agreement made at the time of negotiation. This would create tension between both parties and legal issues could arise. Both parties would have legal grounds to



References: Business Law: Principles for Today 's Commercial Environment. (2013). 3rd Edition Author(s): Twomey; Jennings. Legal Information Institute 2-601 Buyer’s Right on Improper Delivery (1982). Retrieved from http://www.law.cornell.edu/ucc/2/2-601

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