2. Mistake must be of fact and not of law.

3. Mistakes may be in three categories：mutual mistake, common mistake and unilateral mistake.

4. A contract shall be rescinded by a mistake in manifestation of the intention and a mistake in form of manifestation of the intention.

5. The validity of a contract is usually affected by mistake unless the mistake is fundamental and harmful to the contract.

6. Bilateral identical mistake occurs where both parties are mistaken and each makes the same mistake.

7. Non-identical bilateral mistake occurs where X offers to sell car A and Y agrees to buy, thinking A is B.

8. If A buys an article thinking it is worth ￡100 when in fact it is worth ￡50 only, the contract is illegal

9. In common law the contract made in such a mistake is not necessarily void because the court will try to find the sense of agreement.

10. In the light of civil law there are many kinds of mistakes shall vitiate a contract. II. Translate the following into Chinese :

The system of mistake is an old system of civil law, and the expression of intention mistake is different from the concept of mistake in Anglo-American law. The validity of a contract is usually not affected by mistake unless the mistake is fundamental and harmful to the contract. In practice, the following mistakes result in a valid contract. (a) A mistake in intention made by one party, for example, a mistake made in calculation of price. (b) A mistake in judgment, for example, a mistake in estimate of one‘s ability to perform a contract. (c) A mistake in understanding the meaning of a description of certain products in sale of them.

In the light of civil law there are two kinds of mistakes shall vitiate a contract. (a) A mistake in the quality of a subject matter. (b) A mistake in identity of the other counter-party which is vital to the conclusion of a contract.

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Section C

Quasi-Contract

1 The term ?quasi-contract‘, once used to describe the area of law now called ?restitution‘ or ?unjust enrichment‘, is now out of favour. ?Quasi-contract‘ says only that the matter is not contract. So far as it suggests that there is a sort of contract, it deceives, unintelligibly. Quasi-contractual liability should be understood not as part of unjust enrichment, but as a different basis of liability that can help us see what liability for unjust enrichment might be: liability grounded in notions of fairness. 2 The notion of quasi-contract can help us understand what is at stake. whether to impose liability in certain circumstances in which no contract has been made between the parties but when we have good reason to believe that such a contract would have been made if the parties had had the opportunity to do so. This analysis is more fitting for these cases because by trying to find what the parties would have contracted for, it adopts an ex ante perspective. Interestingly, once again we see that commentators who reject the quasi-contractual analysis end up explaining the situation by invoking contractual concepts. For example, in explaining why liability should be imposed only on successful attempts, Burrows writes: ?A reasonable man would surely pay for someone to try to rescue his drowning daughter or to try to save his burning house‘. Burrows comes close to stating the quasi-contractual rationale for imposing liability: the reason why liability should be imposed in such cases is because people would have been willing to pay for the service (even without the guarantee of success), if they had had the opportunity to do so.

3 Within a quasi-contractual analysis it is not difficult to explain why liability need not be limited to successful attempts. In many contracts for service, the service provider does not promise a certain result, only a certain degree of effort. If the promisor fulfils her contractual liability by performing to that level, she does not breach her contractual obligation even if the service she provides does not match a

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certain desired outcome. By contrast, in principle, if the promisor fails to perform to the same degree required by the contract, she breaches the contract even if the non-contracted yet desired outcome is achieved.

4 A true emergency situation that should give rise to quasi-contractual liability exists in the following situation: an uncontracted-for service is provided when (a) transaction costs for the contract are prohibitively high; (b) had the service not been provided, the recipient of the service would have suffered a considerable real loss; (c) the recipient has not provided evidence to suggest that she would have declined the service if she had had the opportunity to do so; and (d) the service provided was of adequate quality. If these conditions obtain and someone provides an unconsented service to another, the provider of the service is entitled to recover from the person she assisted, whether or not her service was successful.

5 The four conditions highlight the quasi-contractual aspect of this sort of liability, both by limiting liability to those situations in which contracts were not made only because of high transaction costs, and by their focus on the ex ante perspective. As with all cases of comparing reality to a hypothetical case, this approach raises a question as to which hypothetical situation we envisage and how different we make it from what actually took place: do we imagine the recipient in perfect health making a contract with the person who provided him with the service, or do we change the facts as little as possible from how things actually were and imagine the recipient consenting to a contract with the service provider in the last moments before losing consciousness? The latter situation may seem the better one because it is ?closer‘ to how things were.

6 However, this case is problematic from a contractual perspective: it is hard to know what a market price for such a case would be, partly because there are not enough such cases to establish a market price. Further, in such cases it would be rational for the recipient to agree to pay anything for a treatment, down to the level of subsistence below which he would rather not stay alive, and because at this moment the particular service provider is a monopolist, it is possible that she will demand such a price. This implies that in such cases the recipient's willingness to pay would be

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strongly affected by his ability to pay, which differs considerably among people. More broadly, the latter scenario is one in which one's autonomy is compromised. As quasi-contract liability is supposed to be grounded in the same notions of autonomy that ground contractual liability. It is also the hypothetical that matches the liability rule proposed.

7 Another aspect of the proposal worth highlighting is that it does not try to identify emergency cases directly. Rather, it assumes that emergency cases are cases of ?considerable loss‘ (and not merely cases of foregone opportunity to make a profit) and limits recovery to them. The basis for this definition is psychological: even though from an economic perspective a lost profit is (more or less) similar to an actual loss of similar size, people tend to react very differently to actual losses and foregone benefits. The second and third conditions provide additional indirect guarantee that only true cases of emergency are captured in the definition. The claimant in such a case would have to show that transaction costs were high, or else her quasi-contractual claim would fail for not taking the contractual route when it was readily available. The third condition not only provides an easy way for the service recipient to avoid liability, but also helps identify rescue cases on the assumption that in other cases the recipient would have rejected the service.

8 Another advantage of the suggested solution over that of free acceptance is that in cases that do not fall under it, the recipient will not have to reject the service because the provider will not be able to establish the first condition. Birks's solution requires the recipient of the service to actively reject the service or otherwise risk having to pay for it. Because the proposed alternative is more finely tailored to identify those instances in which liability should be imposed, in all non-emergency situations the recipient of a service will not have to do anything to avoid liability for unconsented services.

9 The defendant's liability under quasi-contract is equal to the value of the benefit conferred by the plaintiff. The value is the fair market value of the benefit and not necessarily the subjective value that the defendant enjoys. A traditional measure of the fair market value is called quantum meruit, for \much as is deserved.\For

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