Facts
- Hiram Walker & Sons maintained polled Angus cattle on a Michigan farm, including a cow known as “Rose 2d of Aberlone.”
- The Walkers and Theodore C. Sherwood negotiated the sale on the shared understanding that Rose was “probably barren” and unsuitable for breeding.
- The parties agreed by telephone to a price of 5½ cents per pound live weight, less a 50‑pound shrinkage, and the Walkers confirmed the terms in writing.
- The agreed price reflected a cow valued for beef rather than breeding.
- Before delivery, the Walkers discovered Rose was with calf (fertile and pregnant), making her worth far more than the contract price.
- The Walkers refused to deliver and sought to rescind based on mutual mistake as to barrenness.
- Sherwood brought replevin for possession; he prevailed in the justice’s court and again on appeal in the circuit court.
- The Walkers sought review, challenging, among other things, the instruction that it was immaterial whether the cow was with calf.
Issues
- Whether a sale contract is voidable for mutual mistake when both parties believed the cow was barren but she was in fact pregnant, and the belief was a basic assumption of the bargain.
- Whether the seller could rescind on that mistake and thereby defeat the buyer’s replevin claim for possession at the agreed price.
Decision
- The Michigan Supreme Court reversed the judgment for Sherwood.
- The court held the contract was voidable because the parties’ shared mistake regarding barrenness went to the substance of the transaction, not merely to value.
- The Walkers were entitled to rescind, and Sherwood was not entitled to possession under the contract.
Legal Principles
- A contract may be avoided when both parties share a mistake about a material fact that forms a basic assumption of the agreement and affects the substance of the consideration.
- A mistake going to the identity or substance of the thing bargained for can justify rescission; a mistake only as to an incidental quality or degree of value generally does not.
- When the parties bargain on the premise that the subject matter is of one commercial character (barren beef cow) but it is in fact of a fundamentally different character (breeding cow), the mistake may be treated as affecting the essence of the bargain.
Conclusion
The court treated barrenness as a defining attribute of the bargain and held that the parties’ mutual mistake about the cow’s fertility rendered the contract voidable, allowing the seller to rescind and preventing the buyer from enforcing possession at the agreed price.