An Economic Perspective on the Doctrine of Unilateral Mistake in English Contract Law: A Remedy-Based Approach

Northern Ireland Legal Quarterly, 2008

CLEA 2008 Meetings Paper

18 Pages Posted: 29 Apr 2008

See all articles by Qi Zhou

Qi Zhou

University of Leeds - School of Law

Date Written: April 26, 2008

Abstract

The key economic issues in implementing the law of unilateral mistake are twofold. First, it should avoid misallocation of resources; second, it ought to create a sufficient incentive for acquisition of information. However, the rule of unilateral mistake in English contract law does not serve these economic goals satisfactorily. The existing law and economics literature deals extensively with how to achieve these ends by designing the legal standards for a unilateral mistake which can nullify the contract, with little discussion of the function of legal remedy. This paper offers a remedy-based approach and argues that it has economic advantages over the current law.

Keywords: contract law, mistake, remedy, law and economics

JEL Classification: K12

Suggested Citation

Zhou, Qi, An Economic Perspective on the Doctrine of Unilateral Mistake in English Contract Law: A Remedy-Based Approach (April 26, 2008). Northern Ireland Legal Quarterly, 2008; CLEA 2008 Meetings Paper. Available at SSRN: https://ssrn.com/abstract=1125587

Qi Zhou (Contact Author)

University of Leeds - School of Law ( email )

Liberty Builidng
Leeds, LS2 9JT
United Kingdom

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