• In the case of Couturier v Hastie 1858 66 hlc 673, it was held that a contract is void due to common mistake of the subject matter, here, it did not exist at the time the contract was made.

Facts of the Case

  • C chartered a vessel to ship corn from Greece to London.
  • C then engaged D to sell the corn with the promise of commission.
  • D as a result sold the corn to Callander, however at the time of contract, the corn had already been sold off at Tunis.
  • Consequently, C sued D for the price that they are entitled to from the sale to Callander claiming the buyer had attained title to the goods and therefore bore the risk of the goods being damaged, lost or stolen.

Issues in Couturier v Hastie 1858 66 hlc 673

  • Did the common mistake render the contract void

Held by House of Lords

  • Contract void

Lord Cranworth L.C

  • Held that contrary to what the parties contemplated in the contract, there was nothing to be bought nor sold.
  • “Looking to the contract itself alone, it appears to me clearly that what the parties contemplated, those who bought and those who sold, was that there was an existing something to be sold and bought, and if sold and bought, then the benefit of insurance should go with it. I do not feel pressed by the latter argument, which has been brought forward very ably by Mr. Wilde, derived from the subject of insurance. I think the full benefit of the insurance was meant to go as well to losses and damage that occurred previously to the 15th of May, as to losses and damage that occurred subsequently, always assuming that something passed by the contract of the 15th of May.” Pg. 1068

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