Mutual Mistake and Common Mistake in Nigerian Contract Law

Imagine you agree to buy a car from someone, and both of you believe the car exists in the seller’s garage. Unknown to either of you, the car was stolen the night before. Can this agreement be enforced? This scenario illustrates one of the most important defenses in contract law: mistake.

In Nigerian contract law, mistake occurs when one or both parties enter into a contract based on a false belief about important facts. Not every mistake will allow you to escape a contract, but certain types of mistakes are serious enough to make the contract either void (invalid from the beginning) or voidable (can be cancelled by the affected party).

This guide breaks down the types of mistakes recognized in Nigerian law, with clear examples and case law to help you understand when a contract can be set aside due to mistake.

What is Mistake in Contract Law?

Mistake in contract law refers to an erroneous belief held by one or both parties when entering into a contract. For a contract to be valid, there must be consensus ad idem, which is a Latin term meaning “meeting of the minds.” Both parties must agree on the same thing in the same sense.

When there’s a fundamental mistake about what the parties are agreeing to, this consensus is destroyed, and the contract may be invalid.

However, Nigerian courts don’t void contracts for just any mistake. The mistake must be fundamental and relate to essential facts of the agreement. As the court stated in Bell v Lever Brothers Ltd,¹ the mistake must be so serious that it makes the subject matter fundamentally different from what the parties believed they were contracting about.

Types of Mistake in Nigerian Contract Law

Nigerian contract law recognizes three main types of mistake:

1. Common Mistake: Both parties make the same mistake about the same fact. For example, both buyer and seller believe a painting is a fake, but it turns out to be an original masterpiece.

2. Mutual Mistake: Both parties are mistaken, but they’re mistaken about different things. They’re talking at cross purposes. For example, the seller intends to sell his Toyota, but the buyer thinks he’s buying the seller’s Mercedes.

3. Unilateral Mistake: Only one party is mistaken, and the other party knows about the mistake or should have known. For example, someone pretends to be a wealthy businessman to obtain goods on credit.

This article focuses primarily on common mistake and mutual mistake, as these are often confused by law students and practitioners alike.

Common Mistake Explained

A common mistake happens when both parties enter into a contract while sharing the same false belief about a fundamental fact. The mistake is “common” because both parties are making the exact same error about the same subject matter.

Types of Common Mistake

Res Extincta (Subject Matter Doesn’t Exist): This occurs when both parties believe they’re contracting about something that actually doesn’t exist anymore. The Latin term “res extincta” means “the thing has ceased to exist.”

The classic example is found in Couturier v Hastie,² where parties made a contract to buy and sell corn that was being shipped. Unknown to both parties, the corn had already gone bad during the voyage and had been sold off before the contract was signed. The court held the contract was void because the subject matter no longer existed.

In Nigeria, if you agree to buy a specific car, and unknown to both you and the seller, the car was destroyed in an accident the day before, the contract would be void for common mistake based on res extincta.

Res Sua (Buying What You Already Own): This happens when someone tries to buy property that already belongs to them, without knowing it.

The leading case is Cooper v Phibbs,³ where a man agreed to lease a fishery from someone, but it turned out the fishery actually belonged to him through inheritance he wasn’t aware of. The court set aside the agreement because you cannot lease what you already own.

Similarly, in the Nigerian case of Abraham v Chief Amodu Tijani Oluwa,⁴ land was sold under a court order, and the buyer purchased it. He later discovered the land had always been his own property. The court refunded his money because the sale was void due to mistake as to title (res sua).

When Does Common Mistake Make a Contract Void?

For a common mistake to void a contract in Nigerian law, the mistake must be:

• About a fundamental fact: The mistake must go to the root of the contract, not just minor details.
• Shared by both parties: Both parties must have the same wrong belief.
• Not due to negligence: If one party was careless and should have discovered the truth, they may not be allowed to claim mistake.
• About an existing fact: Mistakes about future events or possibilities don’t usually void contracts.

Mutual Mistake Explained

While common mistake involves both parties making the same error, mutual mistake occurs when both parties are mistaken about different things. They think they have an agreement, but they’re actually talking about completely different things without realizing it.

The Classic Example: Raffles v Wichelhaus (The Peerless Case)

The most famous mutual mistake case is Raffles v Wichelhaus.⁵ A buyer agreed to purchase cotton that would arrive on a ship called “Peerless” sailing from Bombay. The problem? There were two ships named “Peerless” sailing from Bombay—one in October and one in December.

The seller was thinking of the December ship, while the buyer expected the October ship. The court held there was no contract because there was no true agreement. The parties were not thinking of the same thing.

How Mutual Mistake Works in Nigeria

In Nigerian contract law, mutual mistake prevents the formation of a valid contract because there’s no consensus ad idem.

Here’s a practical example: Ade has two cars—a 2015 Toyota Camry and a 2020 Mercedes Benz. He puts up a “For Sale” sign that says “Car for Sale – ₦3 million.” Chidi sees the sign and thinks Ade is selling the Mercedes for that price (which would be a bargain). Ade actually intended to sell the Toyota.

When Chidi shows up with ₦3 million expecting the Mercedes, and Ade tries to hand over the Toyota, there’s a mutual mistake. Each party had a different car in mind. No valid contract was formed because there was no meeting of the minds about which specific car was being sold.

Requirements for Mutual Mistake

For mutual mistake to void a contract in Nigeria:

• Ambiguity must exist: There must be something unclear in the offer or acceptance that allows for different interpretations.
• Both interpretations must be reasonable: Both parties’ understanding of the contract must be reasonable in the circumstances.
• No meeting of minds: The parties must genuinely be thinking of different things.

Nigerian courts apply an objective test. They ask: “Would a reasonable person in each party’s position have understood the contract the way that party claims to have understood it?”

The Key Difference: Common Mistake vs Mutual Mistake

Legal Effects of Mistake in Nigerian Law

Void vs Voidable Contracts

Understanding whether a contract is void or voidable is crucial:

Void Contract: This means no contract ever existed legally. It’s invalid from the start (void ab initio). Both common mistake and mutual mistake typically make contracts void. Neither party can enforce the agreement, and any money or property exchanged must be returned.

Voidable Contract: This means the contract exists and is valid unless the affected party chooses to cancel it. Certain types of unilateral mistakes make contracts voidable rather than void.

Remedies Available

When a contract is void due to mistake, Nigerian courts can grant several remedies:

1. Rescission: The contract is cancelled, and both parties are returned to their original positions before the contract. Any money paid is refunded, and any property transferred is returned.

2. Refusal of Specific Performance: Even if a contract isn’t void at common law, Nigerian courts may refuse to order specific performance (forcing someone to complete the contract) if it would be unfair or cause hardship due to a mistake.

In Webster v Cecil,⁶ Cecil had refused to sell land for £2,000, but then mistakenly wrote to Webster offering to sell for £1,500 instead of the £2,500 he meant to write. The court refused to force Cecil to complete the sale at the mistaken price.

3. Equitable Relief: Nigerian courts, following English equity principles, can provide relief even when common law wouldn’t void the contract, if one party would gain an unconscionable advantage from the mistake.

Important Nigerian Cases on Mistake

Abdul Yusuf v Nigerian Tobacco Company

This unreported Nigerian case dealt with unilateral mistake, but it’s frequently cited to show how Nigerian courts handle mistake generally. The court allowed the defendant to escape contractual liability when there was a clear mistake that the other party should have known about.⁷

Adegbokun v Akinsanya

This case highlights the importance of mistake doctrine in Nigeria, where illiteracy is still common in some areas. An illiterate man mistakenly conveyed the wrong property to someone who knew the man’s true intention but didn’t have the contract properly explained to him. The court held the contract void, emphasizing the need to protect vulnerable parties from mistakes they couldn’t reasonably avoid.⁸

Practical Application: When Can You Use Mistake as a Defense?

If you’re involved in a contract dispute in Nigeria, here’s when mistake might help you:

You Can Claim Common Mistake If:

• Both you and the other party believed something fundamental about the contract that turned out to be completely wrong
• Neither of you was at fault for the mistake
• The mistake makes the contract impossible to perform or fundamentally different from what you both intended

You Can Claim Mutual Mistake If:

• You and the other party were clearly thinking of different things when making the agreement
• The contract language was ambiguous enough that both interpretations were reasonable
• There was genuinely no meeting of the minds on a fundamental term

You Cannot Claim Mistake If:

• You were careless and should have discovered the truth
• You made a mistake about the value or quality of something (unless fraud is involved)
• You simply made a bad bargain and now regret it
• The mistake was about your opinion rather than a fact

Relationship to Other Contract Doctrines

Mistake should not be confused with other vitiating factors in contract law:

Mistake vs Misrepresentation: Mistake involves both parties being wrong about facts. Misrepresentation involves one party making a false statement that induces the other to enter the contract. Learn more about misrepresentation in contract law.

Mistake vs Fraud: Mistake is an honest error. Fraud involves deliberate deception. If someone deliberately creates a false impression to induce a contract, that’s fraud, not mistake.

Mistake vs Breach: Mistake prevents a valid contract from forming or makes it void. Breach occurs when a valid contract exists but one party fails to perform their obligations.

Conclusion

Understanding the difference between mutual mistake and common mistake is essential for anyone studying or practicing Nigerian contract law. While both involve errors by contracting parties, they operate differently:

Common mistake means both parties share the same wrong belief about a fundamental fact—like believing a car exists when it’s already been destroyed. If the mistake is serious enough, the contract is void.

Mutual mistake means the parties are at cross purposes, thinking they’re agreeing to different things—like one party selling a Toyota while the other thinks they’re buying a Mercedes. In this case, no contract ever formed because there was no true meeting of the minds.

The key takeaway for law students, practitioners, and anyone entering contracts in Nigeria: always ensure you clearly understand what you’re agreeing to, and confirm that the other party shares the same understanding. When in doubt about significant contract terms, seek clarification. Prevention is always better than arguing about mistake in court later.

For more on contract formation and validity, see our guide on the nature of contract and formation of contract.

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References

Footnotes

1. Bell v Lever Brothers Ltd [1932] AC 161 (HL). ↩

2. Couturier v Hastie (1856) 5 HLC 673. ↩

3. Cooper v Phibbs (1867) LR 2 HL 149. ↩

4. Abraham v Chief Amodu Tijani Oluwa (1925) 6 NLR 42. ↩

5. Raffles v Wichelhaus (1864) 2 H & C 906. ↩

6. Webster v Cecil (1861) 30 Beav 62. ↩

7. Abdul Yusuf v Nigerian Tobacco Company (Unreported). See discussion in ‘Mistake’ (Learn Nigerian Law) https://www.learnnigerianlaw.com/learn/contract-law/mistake accessed 11 January 2026. ↩

8. Adegbokun v Akinsanya discussed in IE Sagay, Nigerian Law of Contract (3rd edn, Spectrum Books 2000) 142. ↩