Smith v. Hughes

"Smith v. Hughes", (1871) LR 6 QB 597 (Queen's Bench Division) is an English case dealing with contract law. It has influenced the law throughout the common law world.

Facts

The defendant was a horse trainer. He refused to accept a shipment of new oats from the plaintiff, claiming that the contract had been for "old oats...." The plaintiff could recall no reference to old oats.

Decision

The court ordered the contract be performed because it appeared that the words "old oats" were never used at the moment of "meeting of minds." "There is no legal obligation on the vendor to inform the purchaser that he is under a mistake, not induced by the act of the vendor." A unilateral mistake does not prevent the acceptance of an offer unless
#the mistake is as to the terms of the contract (as opposed to motivation) and
#the mistake is known to the offeree at the time of purported acceptance.

Some members of the court were also impressed with the fact that the defendant had been given a sample of the oats which he held in his possession for two days. Mistaken assumptions are immaterial to a contract. "If, whatever a man's real intention may be, he so conducts himself that a reasonable man would believe that he was assenting to the terms proposed by the other party, and that other party upon that belief enters into a contract with him, the man thus conducting himself would be equally bound as if he had intended to agree to the other party's terms."