Alleviating Mistakes: Reversal and Forgiveness for Flawed Perceptions.

Author:Rowley, Keith A.
Position:Book review

ALLEVIATING MISTAKES: REVERSAL AND FORGIVENESS FOR FLAWED PERCEPTIONS. By E. Allan Farnsworth. Oxford: Oxford University Press. 2004. Pp. xiv, 216. $95.

TABLE OF CONTENTS I. DEFINING AND DELINEATING "MISTAKE" A. Perception and Reality B. Modes of Mistake C. Mistake versus Misunderstanding D. Mistake versus Misprediction E. Ignorance and Mistake II. TAXONOMY OF MISTAKES III. RELIEF FROM ALLEVIATING MISTAKES A. 'Fessing Up B. Proving Mistake C. Causation D. Relevance E. Types of Relief IV. COUNTERVAILING CONCERNS A. Risk B. Fault C. Other Countervailing Concerns V. CONCLUSION I guess some mistakes you never stop paying for. (1)

There are many kinds of mistakes. One kind--a rational, well-intended act or decision resulting in unanticipated, negative consequences--was the focus of Allan Farnsworth's previous foray into the realm of legal angst. (2) Another kind--an act or decision prompted by an inaccurate, incomplete, or uninformed mental state and resulting in unanticipated, negative consequences--is the subject of the present book.

Like its predecessor, Alleviating Mistakes does not confine itself to contract law, Farnsworth's home turf; it explores criminal, tort, restitution, and other areas of substantive law as well. As such, it paints on too large a canvas to capture its entirety in these relatively few pages. I will try to trace the outlines of the discussion, rearrange and synthesize elements to make the tableau easier to comprehend, and enhance certain aspects with supplemental material--all the while understanding that, just as a description of a painting is no substitute for seeing the original, this review is no substitute for reading Farnsworth's book.


    Sam: About a week ago, I accidentally slept with a prostitute.

    Toby: I don't understand. Did you trip over something? (3)

    Farnsworth envisions a mistake arising from a "flawed perception of reality" (p. 14). Viewing mistake this way reflects "the gap between ... the process of perception and ... the process of decision. During this gap, one acquires beliefs, draws inferences, formulates predictions and opinions, makes judgments, forms intentions, and ultimately arrives at a state of mind that is entirely distinct from initial perceptions" (p. 20). Absent a flawed perception of reality, there is no mistake, only an accident. "An accident occurs when an event causes a consequence that is unexpected and in most cases untoward, but there is generally no flawed perception." (4) In common parlance, accidents happen; people make mistakes. (5)

    Not every flawed perception of reality gives rise to a mistake. Irrational perceptions, particularly those attributable to mental illness or defect, will not relieve a party of liability based on mistake, although the mental illness or defect itself may be a separate defense. (6)

    1. Perception and Reality

      For Farnsworth, the law imagines a mistaken person forming a "sentence in her head" about what she perceives. (7) This sentential approach, while obviously an oversimplified construct, "enables judges to formulate instructions that can be comprehended by jurors and to draft opinions that will be understood by judges in later cases" (p. 25).

      Perception may be active or passive. Active perception results from "actual contemplation" (p. 25). In Sherwood v. Walker, (8) the majority found that a cow's buyer and seller actively perceived her to be barren and worth only $80, instead of fertile and worth between $750 and $1,000. Because the mistake "affected the substance of the whole consideration," the court held that "there was no contract to sell or sale of the cow as she actually was." (9)

      Passive perception is "a tacit or implied presupposition in the minds of the contracting parties." (10) "It is enough if one can say of a supposed fact, 'I did not have the supposed fact in mind at the time, but I could have called it to mind.'" (11) In Gould v. Board of Education, (12) the Board notified Gould that it was denying her tenure but that her file would not reflect the denial if she resigned. Neither she nor the Board realized that she had already achieved tenure-by-estoppel. Gould resigned. Finding that both parties implicitly believed that Gould did not have tenure at the time of the Board's decision, the New York Court of Appeals held that Gould was entitled to rescind her resignation and resume her teaching duties with tenure. (13)

      If mistake is a flawed perception of reality, what is "reality" for purposes of determining whether a mistaken party misperceived it? Sometimes what is really more a matter of when: "One can be mistaken as to a fact even though, at the time, the truth or falsity of the fact cannot be determined." (14) That said, "[a]lthough reality need not be knowable at the time of the flawed perception, it must be provable at the time that the effect of the mistake is to be determined." (15)

      At other times, reality is a matter of opinion. Farnsworth treats all manner of opinion-based mistakes as being akin to mispredictions, rather than factual mistakes, and categorically less worthy of relief. To illustrate, Farnsworth distinguishes between the true identity of the creator of a work of art (authenticity) and the opinion of experts as to the creator's identity (attribution). (16) Whether Edgar Degas painted a particular canvas is an immutable matter of fact--perhaps an undiscoverable fact or a fact that can only be discovered at a later date, but an immutable fact no less. Whether experts attribute the painting to Edgar Degas is also a matter of fact, but not of immutable fact; ultimately, it is a fact based on an opinion. A mistake as to authenticity--whether based on a party's own observation or on an expert's representation is a mistake of fact because it represents a flawed perception of reality. (17) A mistaken attribution is not a mistake of fact because it is nothing more than an erroneous opinion. (18) Nor is an accurate perception of who experts consider to be the artist a mistake of fact--even if the experts are wrong--because there is no gap between the perception of who experts consider to be the artist and the reality of who experts consider to be the artist. (19)

    2. Modes of Mistake

      Some mistakes are mistaken expressions, whereby the parties to an agreement have, or the party making a transfer has, failed to accurately express-typically in writing--the intended terms of the agreement or transfer. (20) Most mistakes are mistaken assumptions, whereby the mistaken party has a flawed perception of external reality. (21)

    3. Mistake versus Misunderstanding

      Farnsworth distinguishes a mistaken assumption from a misunderstanding arising from a party's flawed perception of the other party's understanding or intent (p. 14). A misunderstanding is not a mistake, as Farnsworth uses the term, because merely misperceiving another's meaning does not prevent a contract from forming; rather "[a] court will almost invariably ... find that the meaning of the language accords with the understanding of one or the other of the parties. The perception of that party then prevails" (pp. 14-15).

      Three aspects of Farnsworth's explanation and his accompanying discussion of Raffles v. Wichelhaus (22) concern me. First, while he certainly may define mistake to exclude misunderstanding--a position supported by the Restatement (Second) of Contracts (23)--Farnsworth overgeneralizes in writing that a misunderstanding will not prevent contract formation (pp. 14-15). In fact, a mutual misunderstanding will prevent contract formation. (24) Second, he oversimplifies Raffles by declaring that, "because there was no flawed perception as to any reality outside the minds of the parties, this was not a case of mistake as I use the term" (p. 15). Excellent historical research that predates this book by fifteen years reports that there were multiple ships named Peerless operating in and around England at the time the parties made their contract for cotton "ex Peerless." (25) Consequently, the parties could very well have misperceived external reality if each mistakenly believed that there was only one ship named Peerless. Third, while a contract may form--and, thus, contractual liability arise--despite a party's unilateral misunderstanding of the other party's meaning, what of the other types of liability that Farnsworth discusses throughout the book? For example, suppose that the rightful owner of stolen property confronts the thief, who has the loot in one hand and a pistol in the other. If the owner says, "Let me have it," does the thief's misunderstanding of the owner's meaning affect his criminal or tort liability for shooting the owner rather than handing over the stolen property? (26) Farnsworth provides no insights into the perceived or desired effect of misunderstanding on criminal or tort liability.

    4. Mistake versus Misprediction

      Suppose that, after the 2005 World Series began but before the end of Game Four, I purchased a ticket for Game Six in Chicago, booked a hotel room, and bought a roundtrip airline ticket. Alas, the World Series did not return to Chicago, (27) so I did not use my game ticket, I forfeited my hotel deposit, and I kept the airline ticket to exchange it for one on a future flight. I inaccurately predicted the course of the World Series; but, using Farnsworth's definition, I was not mistaken because I did not have a flawed perception of reality. (28)

      Whether a party may get relief from the effects of a misprediction appears to turn on the type of relief she seeks and the kind of liability from which she seeks it. A party seeking to be excused from criminal or intentional tort liability because her misprediction prevented her from "knowingly" committing the crime or tort typically is excused, provided that she was not aware that it was "practically certain" her act would result in harm to another (p. 54). A party seeking to rescind a contract or to reverse a...

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