Europe

Article 4.102 (ex art. 6.102) - Initial Impossibility 209

A contract is not invalid merely because at the time it was concluded performance of the obligation assumed was impossible, or because a party was not entitled to dispose of the assets to which the contract relates. 210

Article 4.103 (ex art. 6.103) - Mistake as to facts or law 211

1. A party may avoid a contract for mistake of fact or law existing when the contract was concluded if: 212

    • the mistake was caused by information given by the other party; or 213
    • the other party knew or ought to have known of the mistake and it was contrary to good faith and fair dealing to leave the mistaken party in error; or 214
    • the other party made the same mistake, and 215
  • the other party knew or ought to have known that the mistaken party, had it known the truth, would not have entered the contract or would have done so only on fundamentally different terms. 216

2. However a party may not avoid the contract if: 217

  • in the circumstances its mistake was inexcusable, or 218
  • the risk of the mistake was assumed, or in the circumstances should be borne, by it. 219

Article 4.104 (ex art. 6.104) - Inaccuracy in communication 220

An inaccuracy in the expression or transmission of a statement is to be treated as a mistake of the person who made or sent the statement and Article 4.103 applies. 221

Article 4.105 (ex art. 6.105) - Adaptation of contract 222

1. If a party is entitled to avoid the contract for mistake but the other party indicates that it is willing to perform, or actually does perform, the contract as it was understood by the party entitled to avoid it, the contract is to be treated as if it had been concluded as the that party understood it. The other party must indicate its willingness to perform, or render such performance, promptly after being informed of the manner in which the party entitled to avoid it understood the contract and before

2. After such indication or performance the right to avoid is lost and any earlier notice of avoidance is ineffective. 224 that party acts in reliance on any notice of avoidance. 223

3. Where both parties have made the same mistake, the court may at the request of either party bring the contract into accordance with what might reasonably have been agreed had the mistake not occurred. 225

Article 4.106 (ex art. 6.106) - Incorrect information 226

A party who has concluded a contract relying on incorrect information given it by the other party may recover damages in accordance with Article 4.117(2) and (3) even if the information does not give rise to a right to avoid the contract on the ground of mistake under Article 4.103, unless the party who gave the information had reason to believe that the information was correct. 227