Tuesday, October 09, 2007

Contract Act_Practical Problems_32

X sells a horse to Y for Rs. 1,200, but unknown to both parties at the time of the transaction, the horse was dead. Discuss the rights and liabilities of X and Y. Would it make any difference to your answer if the horse was seriously ill at the time of transaction and died within a few hours after the transaction?

Agreement is void on account of mutual mistake of fact essential to the agreement (Section 20). In the alternative situation, however, X will be entitled to the price.

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