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Smith v Hughes (1871) LR 6 QB 597


D took samples of oats. Bought the oats. Afterwards said he only bought old oats and that’s what he thought he was buying


Was there anything in the facts that show that there was a promise to sell old oats? NO
Is passive acquiescence of the seller enough to void a contract?


If a buyer has a chance to inspect goods, and purchases those goods based on his own judgment then the rule of caveat emptor applies
**Your subjective thought does not matter

A mistake by one party known to the other party – does not matter
**Follow caveat emptor – as long as seller does not induce the buyer to buy then he is not liable
***It doesn’t affect the K- EXCEPT: if it is a mistake as to the term of the K
****But a mistake of one party as to the term the K does matter
****No meeting of the minds – bc the parties are not talking about the same terms


Test: Mistake as to the nature of the goods is irrelevant even if it is known by the seller but a mistake as to the terms is relevant since there is no consensus ad idem therefore there would be no K and no obligation.

We must assume that D believed them to be old oats, and that P knew of this and did nothing to bring the belief about. If D had asked if they were old or new the case would have been entirely different – or if D had done anything to show that he was not acting on his own judgement.

There was an argument that the 2 minds were not ad idem – but all that can be said is that they weren’t ad idem as to the age of the oats, but were for the sale of the oats. However – if one party intends to make a K on one set of terms, and the other intends to make it on another set of terms, if the parties are ad idem there is no K.
**Freeman v Cooke – if, whatever’s a man’s real intention may be, he conducts himself that a reasonable man would believe he was assenting to the terms proposed by the other party, and the other party enters into a K, the man thus conducting himself is bound as if he had intended to agree to the other party’s terms

It is essential to the creation of the K that both parties agree to the same thing in the same sense. If 2 persons enter into a K for a particular X, and it turns out that each of them, misled by a similarity of name, had a diff X in mind, no contract would exist (Raffles). But one party may, by his own fault, be precluded from saying that he had a diff sense is understanding the other party – as in the case of sale by sample


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