Objective test applies if a prior concluded contract exists, but subjective test applies if there is a continuing common intention.

By George Schurr and Alex Cox

In the recent case of FSHC Group Holdings Limited v. GLAS Trust Corporation Ltd [2019] EWCA Civ 1361, the English Court of Appeal held that for rectification to be granted on the basis of common mistake, a claimant must establish that either:

  1. the disputed document does not give effect to a prior concluded contract (objectively determined); or
  2. at the time the disputed document was executed, there existed a common intention between the parties in relation to a particular matter (subjectively determined) which, by mistake, was not recorded in the final document as executed.

Rectification is a discretionary remedy that is available to the court in circumstances in which a written contract does not reflect the terms as agreed between the parties, i.e.,where there has been a mistake, not in the making, but in the recording, of a contract[i].