Essential error

An Essential error is a potential ground for invalidating a contract. It occurs where there is an error on a substantial part of the contract, such as the subject, the identity of the other parties, the price or quality of the item, or the nature of the contract.

There are three types of this error, a unilateral error, a Common Error, or a mutual error.

Unilateral Error
As the name suggests, this is an error where one party alone is mistaken about a fact around the contract. Typically these are considered irrelevant, unless the other party knows of the error, and does nothing to correct the error.

Common Error
In this situation, both parties make the same mistake about an item, such as it no longer existing. The contract never came into existence.

Mutual Error
This is similar to Common error, but both parties are mistaken in the nature of the transaction. Perhaps the most well known case is Raffles v Wichelhaus (1864), a contract for carriage was flawed as unknown to both parties, they were both thinking of different ships with the same name. In this case, as there is no consensus in idem, there can be no contract.