unilateral mistake

Inducement is NOT a Required Element in Proving the Defense of Unilateral Mistake

Posted by David Adelstein on August 12, 2018
Appeal, Trial Perspectives / Comments Off on Inducement is NOT a Required Element in Proving the Defense of Unilateral Mistake

Earlier this year I wrote an article regarding proving the defense of unilateral mistake.  In that article, I discussed a case where the appellate court ruled a party asserting the defense of unilateral mistake must prove that the mistake was induced by the party seeking to benefit from the mistake.  Based on this opinion, a party moved for a rehearing en bank under Florida Rule of Appellate Procedure 9.331–see applicable portion of 9.331(d)(1)–arguing that in some prior opinions the appellate court required a party asserting unilateral mistake to prove inducement, and in other decisions it did not. 

The appellate court granted the rehearing en bank to address this undeniable conflict and lack of uniformity holding that inducement is NOT a required element in proving unilateral mistake:  “We conclude that inducement is not an element of unilateral mistake. A contract may be set aside on the basis of a unilateral mistake of material fact if: (1) the mistake was not the result of an inexcusable lack of due care; (2) denial of release from the contract would be inequitable; and (3) the other party to the contract has not so changed its position in reliance on the contract that rescission would be unconscionable.”  DePrince v. Starboard Cruise Services, Inc., 43 Fla.L.Weekly D1734a (Fla. 3d DCA 2018).   Without the inducement element, the defense of unilateral mistake becomes easier to prove.

 

 

9.331(d)(1) Generally. A rehearing en banc may be ordered by a district court of appeal on its own motion or on motion of a party. Within the time prescribed by rule 9.330, a party may move for an en banc rehearing solely on the grounds that the case or issue is of exceptional importance or that such consideration is necessary to maintain uniformity in the court’s decisions. A motion based on any other ground shall be stricken. A response may be served within 10 days of service of the motion. A vote will not be taken on the motion unless requested by a judge on the panel that heard the proceeding, or by any judge in regular active service on the court. Judges who did not sit on the panel are under no obligation to consider the motion unless a vote is requested.

 

Please contact David Adelstein at dadelstein@gmail.com or (954) 361-4720 if you have questions or would like more information regarding this article. You can follow David Adelstein on Twitter @DavidAdelstein1.

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Proving Defense of Unilateral Mistake

Posted by David Adelstein on January 24, 2018
Trial Perspectives / Comments Off on Proving Defense of Unilateral Mistake

One affirmative defense to a breach of contract claim is the defense known as “unilateral mistake.” This is not an easy defense to prove and the party asserting this as a defense has the burden to prove it. Under this defense, the argument is that the contract cannot be enforced because there was a unilateral mistake that induced the party into entering into the contract.

To prove the affirmative defense of unilateral mistake, the party asserting this defense must prove the following four elements:

(1) [T]he mistake was induced by the party seeking to benefit from the mistake, (2) there is no negligence or want of due care on the part of the party seeking a return to the status quo, (3) denial of release from the agreement would be inequitable, and (4) the position of the opposing party has not so changed that granting the relief would be unjust. ”  DePrince v. Starboard Cruise Services, Inc., 43 Fla. L. Weekly D171b (Fla. 3d DCA 2018) quoting Rachid v. Perez, 26 So.3d 70, 72 (Fla. 3d DCA 2010).

The first element – the inducement element—requires making a false statement of a material fact or some other action that induced the mistake. DePrince, supra. Notably, the other party’s knowledge of an error is not enough and is different than inducement. See id.

The second element – the negligence element—requires the party that made the mistake (and acted on the inducement) not to have acted negligently in making the mistake.

For example, in DePrince, a cruise ship’s jewelry store sold a diamond for $235,000 when the diamond was actually worth millions. The ship sought to avoid the transaction and the buyer sued. The ship asserted unilateral mistake as an affirmative defense, meaning the ship needed to prove the aforementioned four elements required for this defense.

 

Please contact David Adelstein at dadelstein@gmail.com or (954) 361-4720 if you have questions or would like more information regarding this article. You can follow David Adelstein on Twitter @DavidAdelstein1.

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