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[emphasis added]. 120 The widening of jurisdiction to embrace a broad equitable jurisdiction could well encourage litigious behaviour and promote uncertainty. 147 It is improper for a party who knows, believes or ought, objectively speaking, to have known of a manifest error to seek commercial benefit from such an error. The defendants argued this pricing was a unilateral mistake and that the complainants took advantage of this. The contract stands according to the natural meaning of the words used. 121 While my views here are not central to my decision, the plaintiffs have adverted to this relationship in a misguided attempt to derail the defence on an arid pleading technicality. I note that Chitty at para5-089, fn25 sagely opines that Taylor v Johnson does not represent English law, at least, where the other party knows that a mistake has been made. He claims visiting, inter alia, the Epinions and Hardwarezone websites, and though it appears that there was at the material time a discussion thread on the error on the Hardwarezone website, the fourth plaintiff denied having seen this. Soon after, the second, third and fifth plaintiffs took their claims to the media. Court Determines if There's a Contract Existence - LawTeacher.net Kiat Boon, Daniel SENG - NUS Law The case of, The offer was wrongly expressed, and the defendants by their evidence, and by the correspondence, have satisfied me that the plaintiff, 116 The term snapping up was aptly coined by JamesLJ in, 117 It should be emphasised that this stream of authority is consistently recognised by all the major common law jurisdictions. There are persuasive arguments against extending the litmus test of unconscionability to all mistake-type situations. As this is a critical issue, it is imperative that each of their positions be carefully evaluated. However, not all principles will or can apply in the same manner that they apply to traditional paper-based and oral contracts. Online Pricing Mistakes | Emerald Insight Being fully conscious of the pivotal nature of this point, I have duly accorded particular attention to the evidence and credibility of each of the plaintiffs. In its pleaded case, the defendant asserts that the automated e-mail responses it sent out in the early hours of 13January 2003 did not confirm that stock of the laser printers were available and would be delivered. The object of the exercise is to determine what each party intended, or must be deemed to have intended. 113 The English Court of Appeal in Commission for the New Towns v Cooper (Great Britain) Ltd [1995] Ch 259, a case of common mistake, imported the concept of Nelsonian knowledge and applied the framework of various categories of knowledge outlined by Peter GibsonJ in Baden v Societe Generale pour Favoriser le Developpement du Commerce et de lIndustrie en FranceSA [1993] 1 WLR 509. Chwee Kin Keong v Digilandmall Pte Ltd - LawTeacher.net It would be illogical to have different approaches for different product sales over the Internet. His own counsels description of him as careful and prudent only serves to corroborate this. The fourth plaintiff duly accessed the e-mail the second plaintiff had sent him pursuant to their conversation. Given that he left everything in the third plaintiffs hands, his legal position is, to that extent, identical to the third plaintiffs. Scorpio: 13/01/20 01:17 what hp online?? There is no question, however, that he placed the orders, that these orders were received by the HP website and that the same automated response sent to the other plaintiffs was sent out to him. Despite their familial relationship, the legal relationship between the two of them was that of agent and principal. The elements of an offer and acceptance are ex facie satisfied in every transaction asserted in the plaintiffs claims. 17 Having called the second and third plaintiffs at about 2.00am, the first plaintiff also sent them, via e-mail, a weblink of the relevant HP website pages. There must be consensus ad idem. (PDF) Intention to Create Legal Relations and the Reform of Contract The case involved the sale of printers by the defendant at a price of S$66. His revelation that he did not know if this is an error or whether HP will honour this purchase, not to mention the articulation of his hope that by the time you see this email, the price is still at S$66.00, 27 The first plaintiff obviously took the view that the advertisement should be acted upon urgently. The plaintiffs are, however, entitled to the cost of the amendments, in any event, which I fix at $1,000. Altogether he sought to purchase 760 units, the largest number of orders placed by anyone between 8 and 13January 2003. Desmond: 13/01/20 01:47 wasnt greedy before I tok to u. Scorpio: 13/01/20 01:47 yeah.. S$1 mio then no need to work liao?? Mistakes are usually synonymous with the existence of carelessness on the part of the mistaken party. There are, however, other sound reasons to argue against such a rule in favour of the recipient rule. He was also involved in initiating the Channel NewsAsia report (see [78] and [79] infra). He also claimed to have talked to buyers in the market about reselling the laser printers and that the failure to procure the units would tarnish his reputation. In this case, there was no consensus ad idem or meeting of the minds between the parties, which meant that there could be no binding contract between them. Transactions over websites are almost invariably instantaneous and/or interactive. Articles 11 (1) Country Singapore. In the High Court, the learned judge ("the Judge") decided, in the main, in favour of the Purchaser. But there would have, at least, to be some real reason to suppose the existence of a mistake before it could be incumbent on one party to question whether another party meant what he or she said. This is an area that needs to be rationalised in a coherent and structured manner. Mistakes that negative consent do not inexorably result in contracts being declared void. 153 These statements of jurisprudence are of cardinal importance in understanding and fashioning the law of contract. Singapore Court of Appeal. After the defendant intimated that it would not be delivering the laser printer, he sent an e-mail excoriating it, asserting, inter alia: Myself, and other people who have been disappointed by you decision, will definitely spread word of the companys lack of honour and integrity to everyone we know and all over the internet! I even went to both the HP Web-Site as well as the DigilandMall Web-site to see if the prices were the same. Solicita tu prueba. Normally, however, the task involves no more than an objective analysis of the words used by the parties. 56 He vacillated throughout his evidence between a propensity to embellish his evidence on the one hand and to hold back on the other. The caption in each of the e-mails Successful Purchase Confirmation from HP online says it all. 139 Next, the defendant contends that no consideration passed from the plaintiffs to them. Certainty in commercial transactions should not be trifled with, as this will inevitably affect how commercial and business exchanges are respected and effected. In the light of that consideration we can see no way that Solle v Butcher can stand with Bell v Lever Bros Ltd. The very foundations of predictability, certainty and efficacy, underpinning contractual dealings, will be undermined if the law and/or equity expands the scope of the mistake exception with alacrity or uncertainty. It can however be observed that in mass mistake cases, even when there is no direct evidence as in these proceedings, the court could be prepared to pragmatically assume actual or deemed knowledge of the manifest mistake. When notified and satisfied that this transaction was successful as well, he placed a final order at 4.21am for ten laser printers on the HP website, charging this to his credit card. Ltd. has the makings of a student's classic for several reasons, including: 1. Before dealing with the point of real substance, it is appropriate to briefly deal with two of the less meritorious contentions advanced. 49 Tan Cheng Pengs brief evidence did not really assist the third plaintiff. As most web merchants have automated software responses, they need to ensure that such automated responses correctly reflect their intentions from an objective perspective. There is however much to be said in favour of rationalising the law of mistake under a single doctrine incorporating the best elements of common law and equity. His girlfriend, Tan Cheng Peng, is also a director and shareholder of the company in which he has a stakeholding with the first and second plaintiffs. This can result from human interphasing, machine error or a combination of such factors. Certain Internet service providers provide the technology to inform a sender that a message has not been properly routed. Borneo United Sawmills Sdn Bhd v. MUI Continental Insurance Bhd (Marine insurance - Loss of goods - Claim for loss of goods under Marine Cargo Policy) [2009] 8 CLJ 217. It is axiomatic that normal contractual principles apply but the contractual permutations will obviously be sometimes more complex and spread over a greater magnitude of transactions. Whether the parties have reached agreement on the terms is not determined by evidence of the subjective intention of each party. 26 It is clear from the priority status accorded to the e-mail that the first plaintiff was sharing his knowledge of a good deal. Secondly, widening the scope of mistake, unilateral or otherwise, under the rubric of equitable mistake will, with its malleability, only encourage uncertainty and litigation. He has common business interests with the first, third and fourth plaintiffs. Unilateral Mistake at Common Law and In Equity After referring to a series of leading cases, including the often quoted decision of ThomsonJ in McMaster University v Wilchar Construction Ltd (1971), 22DLR(3d) 9 (Ont HCJ), Chief Justice McLachlin said at p37: One circumstance falling clearly within the equitable jurisdiction of the Court to relieve against mistake is that where one party, knowing of the others mistake as to the terms of an offer, remains silent and concludes a contract on the mistaken terms: Solle, supra; Belle River Community Arena v WJC Kaufman Co (1978), 20OR(2d) 447, 4 BLR 231, 87DLR(3d) 761 (CA). We can understand why the decision in Bell v Lever Bros Ltd did not find favour with Lord DenningMR. An equitable jurisdiction to grant rescission on terms where a common fundamental mistake has induced a contract gives greater flexibility than a doctrine of common law which holds the contract void in such circumstances. The defendant programmed the software. To confine this exception to instances of fraud would make the concept of unilateral mistake redundant. MrTan said: As long as we get out [sic] equitable compensation, we should be able to accept lesser terms, but thats just under consideration as well.. Gill & Duffus Landauer Ltd v London Export Corp GmbH [1982] 2 Lloyd's Rep. 627. 51 The fourth plaintiff received a phone call from the second plaintiff at about 2.00am, informing him that there was money to be made through the purchase of laser printers. This rationalised the law and gives the court a broad discretion to fashion the applicable relief. Despite the general views expressed in Taylor v Johnson (1983) 151CLR 422 on equitable mistake, it seems to be generally accepted in Australia as well, that this class of cases requires special mention and consideration. 125 The principal source of this view has been Lord DenningMR. The current general approach is correctly stated in Professor Jeffrey Pinslers Singapore Court Practice 2003 (LexisNexis, 2003) at para20/5/7: An amendment may be allowed even after both parties have made their closing submissions. However, at the actual hearing of the applications, plaintiffs counsel opposed any amendments whatsoever to the defence and sought leave to withdraw the plaintiffs earlier unilateral amendments. The plaintiffs were not being candid when they portrayed very limited exchanges between themselves, dealing allegedly with only the profits to be made and their ability to resell the laser printers. The CISG has currently been adopted by 95 Contracting States world-wide. The modern approach in contract law requires very little to find the existence of consideration. The first, second and third plaintiffs have been friends for a long time and are bound by common business interests. 111 This approach appears to have been endorsed by Judith PrakashJ in Ho Seng Lee Construction Pte Ltd v Nian Chuan Construction Pte Ltd [2001] 4 SLR 407 at [84] where it was also accepted that: The test is an objective one based on what a reasonable person would have known in similar circumstances. The prospective buyer has to make an offer to purchase which is then accepted by the merchant. It is germane to observe that none of the cases purporting to follow Solle v Butcher [1950] 1 KB 671 have with any degree of clarity defined the parameters of equitable mistake in contradistinction to a common law mistake. This, by an uncanny coincidence, was the same person whom he had intended to consult in the resale of the laser printers a topic that he had discussed with the second plaintiff earlier that morning. Different protocols may result in messages arriving in an incomprehensible form. The sixth plaintiff is precluded from asserting his ignorance. This may have created formatting or alignment issues. - This is also the position as regards friends: see Coward v. MIB (1963). The case of Hartog v Colin & Shields [1939] 3All ER 566 is incontrovertibly the leading authority in this area. (2d) Chwee Kin Keong v Digilandmall [2004 ] SGHC 71 In short, where does the justice reside? A particular class of case which illustrates unilateral mistake as to the terms intended, known to the other party, is that in which an offer which would be very advantageous to the offeree is snapped up by the offeree. . 89 In the circumstances, I had little hesitation in allowing the amendments sought by the defendant. Registered office: Creative Tower, Fujairah, PO Box 4422, UAE. Normally the contract is only concluded when the acceptance is communicated by the offeree to the offeror. 127 The attempt to conflate the concept of common law mistake and the equitable jurisdiction over mistake is understandable but highly controversial. He would make some basic enquiries to ascertain whether there is anything faulty with the product in an attempt to seek an explanation for or understanding of the basis for the price discrepancy; he might alternatively try and ascertain whether perhaps the price differential is part of some spectacular promotional exercise. 144 I find, in the alternative, that the plaintiffs, given each of their backgrounds, would in any event, each have separately realised and appreciated, before placing their purchase orders, that a manifest mistake had occurred even if no communications on the error had taken place between them. MrYeow said: After we ordered, the very next day, some of us have even gone up to talk to buyers in the market about the units. FEATURE - Law Gazette It was found that the plaintiffs must have known or realised that the offer did not express the true intention of the defendants. 9 The defendants assertion that Samuel Teo had neither the authority nor the intention to make any alterations to the laser printers price is now accepted by the plaintiffs. six plaintiffs ordered 1,606 printers. The Canadian and Australian cases have moved along with the eddies of unconscionability. It had consciously not inserted any limits to the number of products a buyer could purchase again, quite clearly, to solicit more business. Most telling of all, I note that the first to fifth plaintiffs exhibited identical reports in each of their affidavits without any qualification whatsoever. The businessmen saw a great opportunity and grabbed it placing an order for 1,000 printers. This is one of the first prominent case that deals with the issue of web based contract. To export a reference to this article please select a referencing stye below: This selection of essays, case summaries and dissertations is of relevance to law students within the Commonwealth and for those students who are studying the Rule of Law from outside the Commonwealth . CISG-online | CISG-online.org In New Zealand, the legislature enacted the Contractual Mistake Act 1977. When giving evidence, he struck me as cautious, taking great pains to convey the impression that his numerous online enquiries that morning were routinely carried out without any real inkling that an error had occurred. Offer and acceptance - The analysis is structured around the 14 The first, second and fourth plaintiffs became acquainted with each other when they studied at the Nanyang Technological University (NTU). This is an inane argument. As a lawyer, he appears to have been indispensable in the plaintiffs attempts to hold the defendant to the bargain. The plaintiffs refute that the error exonerates the defendant; they insist that a concluded contract is sacrosanct and must be honoured. It takes the view that there is no jurisdiction in equity to rescind a contract that is valid at common law, on the basis of mistake. After the second plaintiff read out some of the terms and conditions he had found, the fifth plaintiff told him that the contract was binding upon a successful purchase order being received. The evidence incontrovertibly indicates that the first plaintiff himself entertained this view for the entire period he was in communication with the second and third plaintiffs. The argument is that, despite appearances, there is no real correspondence of offer and acceptance and that therefore the transaction must necessarily be void. Needless to say, he could not satisfactorily explain why his previous solicitors had formed such a view when preparing his affidavit and why he had affirmed the same. There must be consensus ad idem. The answer on the authorities is a mistake by one party of which the other knew or ought reasonably to have known. Be that as it may, the fifth plaintiff, soon after he received MsTohs research, shared the information with the second and third plaintiffs. In Chwee Kin Keong v. Digilandmall.com Pte Ltd, one of the defendant's employees mistakenly uploaded the contents of a training template onto the defendant's website, resulting in the retail price of S$3,854 for a commercial laser printer on the website being replaced with the figure S$66. In addition, each of the confirmatory e-mail responses states at the outset: [W]e will be calling you in the near future to deliver the products to the address shown below. . It was listed at the price of $66, when it was advertised on the official HP website for $3,854. 59 Upon duly accessing the HP website through the hyperlink sent to him by the second plaintiff, the fifth plaintiff ascertained that the laser printer was priced at $66. He placed another order for a further 150 printers at 3.14am, followed by two further orders for 300 printers each at about 3.56am and 3.59am. Chwee Kin Keong v Digilandmall.com Pte Ltd,( [2005]SGCA 2 ) . 2. The essence of unilateral mistake is the knowledge or deemed knowledge of a mistake and though fraud may often be present it is not an essential ingredient. The purpose of the amendments was merely to regularise the pleadings and indeed they went no further than to summarise evidence and submissions that had already been raised. . Civil Procedure Pleadings . After the defendant intimated that it would not be delivering the laser printer, he sent an e-mail excoriating it, asserting, I felt that I had done all that was conceivably within my means to ensure that the Price was. 126 The Australian courts appear to have relied on the views of Lord DenningMR in Solle v Butcher to establish a wholly different doctrinal approach to mistake and have purportedly applied a fused concept of law and equity to the law on mistake. 63 It is pertinent he too made web searches using the Google search engine. PDF CISG-online | CISG-online.org Websites often provide a service where online purchases may be made. The later the amendment, the greater the adverse consequences. The very foundations of predictability, certainty and efficacy, underpinning contractual dealings, will be undermined if the law and/or equity expands the scope of the mistake exception with alacrity or uncertainty. He appeared distinctly uncomfortable during several phases of his cross-examination and his answers on crucial points were evasive and often vague.. His evidence in relation to the level and nature of communications he had with the second and third plaintiffs on the morning in question lacked candour. Yong Pung HowCJ in Tribune Investment Trust Inc v Soosan Trading Co Ltd [2000] 3 SLR 405 at [40] opined: [T]he function of the court is to try as far as practical experience allows, to ensure that the reasonable expectations of honest men are not disappointed. Scorpio: 13/01/20 01:24 huh?? Even if it were to be held that there is now a general test of unconscionability applicable to all types of mistake, the plaintiffs contentions will not take them far. The rigour in limiting this scope is also critical to protect innocent third party rights that may have been acquired directly or indirectly. 36 The second plaintiff was the key person and pivotal in the entire chain of events. It deals with the process rather than the substance of how to divine the rule. Landmark decision on unilateral mistake of fact in respect of the price of product listed on an online mall and the purchases made thereon . 27 The first plaintiff obviously took the view that the advertisement should be acted upon urgently. This short but highly significant e-mail reads: Subject: IMPT HP Colour LaserJet going at only $66!! 85 Having stated the general rule, it is imperative that the rationale underlying this approach be understood. I accept that this is capable of including circumstances in which a person refrains from or simply fails to make enquiries for which the situation reasonably calls and which would have led to discovery of the mistake. Not all one-sided transactions or bargains are improper. Users may find that it may not be as forgiving as more traditional methods of communications. There is no larger noble principle, such as the sanctity of contracts, to be observed or protected in these proceedings. The common law has drawn the line in Bell v Lever Bros Ltd. This was also the practice in the trade. SingletonJ held at 568: The offer was wrongly expressed, and the defendants by their evidence, and by the correspondence, have satisfied me that the plaintiff could not reasonably have supposed that that offer contained the offerers real intention. The issue could be critical where third party rights are in issue as in. 52 He then called the second plaintiff on his handphone and informed him that he intended to purchase 50 laser printers. Indeed, in difficult cases, the courts in several common law jurisdictions have gone to extraordinary lengths to conjure up consideration. Certainly, none of them had ever been induced to conduct transactions on such a scale on the Internet for any product, let alone sophisticated commercial laser printers. This could account for the substantial number of Canadian cases in this area of the law. Rules and case law pertaining to amendments are premised upon achieving even-handedness in the context of an adversarial system by: (a) ensuring that the parties apprise each other and the court of the essential facts that they intend to rely on in addressing the issues in controversy or dispute; (b) requiring that an amendment should be attended to in the usual course of events, at an early stage of the proceedings, to ensure that no surprise or prejudice is inflicted on or caused to opposing parties; (c) requiring careful consideration whether any amendments sought at a late stage of the proceedings will cause any prejudice to the opposing party. Offer and acceptances have to reach an intended recipient to be efective. This is a matter perhaps best left to law reform rather than to incremental judge-made law which may sow the seeds of confusion and harvest the returns of uncertainty. PDF Unilateral Mistake in Contract: Five Degrees of Fusion of Common Lawand Though both of them admit to having had discussions about the website terms and conditions governing the purchases, they deny that there was any discussion between them on even the possibility of an error having taken place. It is important not to force into a Procrustean bed principles that have to be modified or discarded when considering novel aspects of the Internet. This assertion is patently untrue. 92 The Electronics Transaction Act (Cap88, 1999Rev Ed) (ETA) places Internet contractual dealings on a firmer footing. Digilandmall.com Pte Ltd. If an offeree understands an offer in accordance with its natural meaning and accepts it, the offeror cannot be heard to say that he intended the words of his offer to have a different meaning. One of the few cases on electronic contract formation in Singapore was Chwee Kin Keong v Digilandmall. What is urged is that, owing to a common error as to some fundamental fact, the agreement is robbed of all efficacy. 116 The term snapping up was aptly coined by JamesLJ in Tamplin v James (1880) 15ChD 215 at 221. This can be supported by the decision of the High Court of Singapore in the case of Chwee Kin Keong v. Digilandmall.com Pte Ltd, in which Judicial Commissioner Rajah argued that "the party who selects the means of communication should bear the consequences of any unexpected events" . 146 A purchaser in a case of apparent unilateral mistake, who purchases for genuine own use a product, may not always be viewed as guilty of engaging in snapping up. Following closely to the Singapore High Court in Chwee Kin Keong & Others v Digilandmall.com Pte Ltd [2004] 2 SLR 594 as a precedent with similar context, the court would most likely try to determine if there is an existence of a contract or if an agreement has been reached in the first place, so we refer to Lord Phillips in Shogun Finance Ltd v The case went before both the High Court and the Court of Appeal. 55 The fourth plaintiff is technologically savvy and runs an Internet business with the second plaintiff. Before retiring for the night, the first plaintiff had a further discussion with the second plaintiff on how to store the laser printers they had ordered. Furthermore, unlike a fax or a telephone call, it is not instantaneous. http://www.buy.hp.com.sg/hp/StandardProduct.cfm?prodid=HPC9960A. He was amicus curiae to the Court of Appeal of Singapore in the case of Chwee Kin Keong & Ors v Digilandmall.com Pte Ltd, the leading Singapore case on unilateral mistake in the digital environment. These considerations take precedence over the culpability associated with causing the mistake. They were selling a HP laser printer and an employee accidently made a mistake as to the price of the printer on their website.. Cases The bites, however, may taste quite different and cause different sensations. 3 All six plaintiffs are graduates, conversant with the usage of the Internet and its practices and endowed with more than an adequate understanding of business and commercial practices. Section11 of the ETA expressly provides that offers and acceptances may be made electronically. We are only concerned with the question whether relief might be given for common mistake in circumstances wider than those stipulated in Bell v Lever Bros Ltd [1932] AC 161. Typical transactions are usually but not invariably characterised by (a)indecent alacrity; and (b)behaviour that any fair-minded commercial person similarly circumstanced would regard as a patent affront to commercial fairplay or morality. The other knows, or must be taken to know, of his mistake. 118 The Canadian courts have been the most active common law courts explicating and developing this area of the law.