A defect of consent is a situation where a party’s declaration does not reflect his actual intent. This difference between declaration and intent may be caused by other parties,in order to make someone to form a contract with themselves. Fraud and Duress are this kind of defects. Roughly,fraud is deceiving someone by hiding certain facts or giving them a wrong impression/information in order to make them form a contract and duress is scaring or threatening someone to make them form a contract.
If there is a difference between declaration and intent,which unintentionally resulted from the declarant,we can say there is an error. In some cases,both parties are mistaken about contract. Such defects are called “Collective Error”. In these situations,contract is formed by parties’ true intent,not according to their false statements. Error In the TCO article 30,the law states that “A party acting under an essential error when entering into a contract is not bound by it.
” Interpreting this article,we can deduce that essentiality is a key concept,since unessential errors will not affect validity of the contract.
Some aspects of essential error are specified in TCO,but law does not limit cases of essential error with those articles. Unwritten states of essential error are determined by the rules of good faith. Error may occur in several ways: Error in declaration In the TCO article 31 the law sets forth: An error is deemed particularly essential in the following cases Where a party intended to conclude a contract different from that to which he consented.
A wants to sell 100 kilos of olive oil to B, but during the formation of the contract, A inadvertently states that he wants to buy 100 kilos of olive oil and B agrees the offer. Where a party has concluded a contract relating to a subject matter other than the subject matter he intended. A wants to buy E branded good, but during the formation of the contract he states he wants to buy F branded good by mistake and is not aware of it. Where a party declared his intent to conclude the contract other than the whom he intended to. A wants to send an offer via mail to B, but he writes a different adress and mail goes to C. C accepts the offer. Where a party took a specific person into consideration as the other party in entering a contract but declared his intent to another.
A is a nanny who wants to raise B’s child C, but during the formation of the contract she stated the name of B’s mentally deficient child D. A is mistaken about someone’s identity, not someone’s qualifications. Otherwise it would be error in motive, which shouldn’t be confused. 5- Where a party has promised to make a significantly greater performance or has accepted a promise of a significantly lesser consideration than he actually intended. Error in calculation of a simple nature do not affect the validity of the contract;but they should be corrected.
A good should have 10. 000 dollars written on its label but accidently 1000 dollars is writtenon label. A buys the good for 1000 dollars. Error of Agents The law states in TCO article 33 that “Where an offer to enter into a contract has been incorrectly communicated by a Messenger, translator or other agents or by any means, the provisions governing error are applicable”. Error of agents are counted as error in declaration. Mistranslation, misinforming, changes in the text during telegraphing… are examples of such errors.
Error by Considering a Demeanour as Consent When a party’s action is considered as an offer or acceptance by another party, and the other party is right to consider this as such and forms the contract, contract will be valid. However mistaken party can put forward that he is mistaken and benefit from the provision of error in declaration. Texts signed without reading If a party signs a text without reading , and is right to think that the text suits his intent, outcome is determined by the other party’s knowledge about this intent.
If the other party knows or has to know that text does not suit signer’s intent, contract will not have been formed and thus there will not be any need for provisions of error. On the other hand, if the other party does not know or have to know the signer’s intent, contract will be formed, but signing party by proving that the error is essential, can benefit from provisions of error in declaration. Signature in Blank One of the parties agree to sign in blank first, then allow other party to constitute the contract.
If this contract formed later on has contents which do not suit signing party’s actual intent, he can benefit from provisions of error. Error in Motive Error in motive is caused by an error in the formation of intent. On principle, error in motive is not essential. If there are conditions prescribed by the law, there is an essential error in motive. In TCO article 32, the law sets forth that “Error in motive is not deemed as essential unless the mistaken party deems the motive as necessary basis for the contract and it is valid regarding the business affairs in good faith.
Yet this rule is not applicable unless the other party is aware of this motive” According to this article, error in motive is essential if the party deems this motive as necessary basis for the contact. This means the party is mistaken about a subject or qualifications of someone which affected his decision to form the contract. Error in material qualification, error in fact, error in legal status are examples of such mistakes. A wants to buy sculpor B’s statue but in fact the statue is a replica. In this situation there is error in material qualification. A thinks he is assigned to a job in another city, so he rents a house in that city.
He made an error in fact. A purchases a land to build a house, but does not know construction is forbidden on this site. He is mistaken about land’s legal status. Also if other party is or has to be aware of the motive, error is deemed as essential. This should be determined in the present case. Avoidability In TCO art. 30 the law stipulates that “A party acting under an essential error when entering into a contract is not bound by it. ” However this is limited by TCO art. 39. The contract will be valid if the mistaken party does not abolish the contract in a year, beginning from the moment he realises his error.
Good Faith Rules in Error Right to avoid is also limited by the law. The law states in TCO art. 34 that “A person may not advance error in a manner in violation of good faith. In particular, the contract is considered to be concluded in a way that the party acting in error intended, in case the other party declares his consent to be bound by that contract. ” Violation of good faith mentioned in the first subsection may be like this: A person learns that he made an essential error about a contract which he concluded years ago. He wants to use his right to avoid just to damage other party.
In that case he will not be able to benefit from provisions of error since it is a violation of good faith. Second subsection of this provision is particularly important. I wish to give a case in this point, in order to better explain it: A wants to buy a kilo of fruit for 2 Liras, but he is mistaken and accepts B’s offer to buy a kilo for 3 Liras. Then A states his mistake to B, B immediately says he is ready to sell it for 2 Liras. In this situation A cannot put forward that he wants to nullify the contract, since he made an essential error. The contract is formed.
Error by Negligence According to TCO art. 35 “A party acting in error is liable for any loss arising from the nullity of the agreement where the error is attributable to his own negligence. However, there is no compensation if the other party knew or should have known of the error. In the interests of equity, the Court may, not exceeding the benefit of standart performance, award further damages to the injured party. ” The first subsection is about responsibility of parties’ actions before the formation of the contract (culpa in contrahendo).
Even a slightest negligence in error results in culpa in contrahendo, and in such situations damages will be compensated. According to the second sentence of this subsection, there will not be any compensations if the other party knew or should have known of the error. But this provision is not applicable to error of declaration, since if the other party knew or should have known the error in declaration, contract is formed according to the declarant’s real intent. Yet if a party knows or has to know other party made an error in motive, mistaken party will not have to compensate any damages even if he abolishes the contract.
Amount of the damage that will be compensated, is the damage that would not exist if the contract would not be formed. This kind of damage is “negative damage”. Benefit of the standart performance is named as “positive damage”. According to the second subsection, judge may decide further damages. This “further damage” is compensation of positive damage. Amount of positive damage that must be compensated may be some of the positive damage or all of the positive damage, determined by equity, but cannot exceed positive damage.