Rectification of a Mistyped Purchase Price
A buyer and seller sign a written agreement for the sale of a commercial unit. During negotiation, emails consistently state the price as 480,000. The typed final contract records 840,000, a transposition neither party notices. The buyer pays a 10% deposit of 84,000 calculated from the typed figure. Three weeks later the buyer's solicitor spots the discrepancy and the buyer seeks rectification to 480,000. The seller resists, arguing the signed document governs and that the buyer, a sophisticated investor, should bear the loss. The seller has already refused a request to exchange corrected copies. No third party has relied on the 840,000 figure, and the property remains unsold. The buyer asks what remedy is realistically available and on what conditions.
1. Identify the remedy the buyer should pursue and state the elements the buyer must establish.
Read the worked answer
The buyer should seek rectification, a discretionary equitable remedy correcting a written instrument that fails to record the parties' true common intention. The buyer must establish: (1) a common intention or continuing common accord existing at the time of execution; (2) that the document fails to record that intention; and (3) convincing proof of the discrepancy - the standard is demanding, commonly described as requiring evidence that leaves no reasonable doubt. Here the pre-contractual emails stating 480,000 supply strong contemporaneous evidence of common intention, and the transposition of digits is a classic clerical error. The 10% deposit of 84,000 is consistent with the typed figure, which the seller may use to argue the buyer's conduct reflected 840,000 - but a deposit calculated mechanically from the erroneous clause is weak proof of intention. Because rectification is equitable, the court weighs conduct and any prejudice to third parties; none exists here.
2. The seller argues the signed document must govern. Assess the strength of that argument and any conditions a court might attach to relief.
Read the worked answer
The argument is weak in principle. A signature ordinarily binds, but rectification exists precisely because a signed instrument may misstate the true agreement; the parol evidence rule does not bar rectification. The seller's 'sophisticated investor' point goes to discretion, not entitlement: carelessness by the claimant is a factor but not an automatic bar, particularly where the error is a pure transposition and the other party equally overlooked it. The seller's stronger practical point is the deposit: the buyer paid 84,000, which objectively tracks 840,000, and the seller will argue the buyer's own conduct confirmed the typed figure. The buyer should counter that the deposit was a mechanical 10% computation performed by a solicitor, not an independent expression of price. Conditions the court may impose: the buyer may be required to pay the seller's costs occasioned by the error, and relief may be refused if it would prejudice a third party who acquired rights for value - not the case here, since the unit is unsold. The realistic outcome is rectification to 480,000 with the buyer bearing the costs of correction, the deposit then adjusted.