May and Butcher v The King, 1934 KB 117, All ER Rep 679 HL
Citation:May and Butcher v The King, 1934 KB 117, All ER Rep 679 HL
Rule of thumb
If all the essentials of a contract are not settled then is there a valid legally enforceable contract? No, where there is a mistake about one of the essentials of the contract, usually (i) who the parties are, (ii) the subject-matter/nature of the contract, which mean that it cannot be said with certainty what was actually being contracted for, then this is a void contract based upon essential error – this can vary according to the circumstances however.
Court held:This is a seminal case on the contract law principle of essential error. All the fundamentals of a contract need to be agreed in order for their to be a contract, although the full details do not need to be agreed before a contract is formed. Debates and differences of opinions can arise as to where the line is between the fundamentals being agreed and the details being thrashed out.
Ratio-decidendi:
'to be a good contract there must be a concluded bargain and a concluded contract is one that settles everything that is necessary to be settled and leaves nothing to be settled by agreement between the parties. Of course it may leave something which still has to be determined, but then that determination must be a determination which does not depend ont the agreement between the parties. In the system of law in which I was brought up, that was expressed by one of those brocards og which perhaps we have been too fond, but which often expresses very neatly what is wanted: 'Certum est quo certum reddi potest'. Therefore, you may very well agree that a certain part of the sale, such as price, may be settled by someone else. As a matter of the general law of contract all the essentials have to be settled. What the essentials are may vary according to the particular contract under consideration', Viscount Dunedin
Ratio-decidendi:
'... all the essentials have to be settled. What the essentials are may vary', Lord Dunedin, 27
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