Legal and contractual solutions · Tenders
What relief is available where a tender is accepted with knowledge of an error?
Unilateral mistake, knowing exploitation and rectification
Acceptance ordinarily fixes the tendered bargain even where the price contains an error. Rectification may be available in the exceptional case where the recipient knew of the tenderer's mistake and took advantage of it.
Quick answer
A tendering error does not ordinarily permit repricing, but knowing exploitation of the mistake may justify rectification
The tenderer must prove more than an obvious undervalue or an avoidable estimating failure. It must establish its actual intention, the recipient's actual knowledge of the mistake and conduct amounting to taking advantage of it. Where those matters are proved, the court may reform the relevant document so that it records the transaction recognised in equity.
| Issue | Position |
|---|---|
| Accepted tender containing an error | The tenderer ordinarily bears the error. |
| Recipient suspects an error | Suspicion alone does not establish rectification. |
| Recipient knows and takes advantage | Unilateral rectification may be available. |
| Required proof | Actual intention, actual knowledge and exploitation must be established. |
| Best protection | Detect and notify the error before acceptance. |
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