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A buyer and seller agree to the sale of a particular horse. The horse was already dead when they made…

Section 20 makes an agreement void when both parties are mistaken about a fact essential to it. Illustration (b) gives this very example of a horse that was already dead…

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A buyer and seller agree to the sale of a particular horse. The horse was already dead when they made the agreement, and neither knew that. What is the legal effect under the Indian Contract Act, 1872?

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Answer and explanation

Correct answer A

Section 20 makes an agreement void when both parties are mistaken about a fact essential to it. Illustration (b) gives this very example of a horse that was already dead when the parties agreed to the sale.

Option feedback

Option A

Both parties were mistaken about an essential fact when they made the agreement, so section 20 makes it void.

Option B

Section 20 makes a bilateral mistake of essential fact grounds for voidness, without requiring a buyer’s election.

Option C

Section 20 does not make the outcome depend on the seller’s election.

Option D

The existence of the particular horse at formation is an essential fact, so the mutual mistake makes the agreement void.

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