Quote from: JoelKatz on November 15, 2012, 10:14:47 AM

Quote from: Namworld on November 15, 2012, 08:02:56 AM

The doctor's lawyer seems to agree with me about common mistake in contracts because your doctor ended up doing the opposite.

There wasn't a common mistake in that case at all. The doctor represented that he had knowledge that I didn't have that led him to conclude that the insurance would pay for it. I had no way to check his reasoning. The point of that example is to see that you can't stop at the contract -- because my prior agreement with the doctor made me responsible for any costs the insurance wouldn't pay, his false representation (one I had no way to check nor any reason to doubt) damaged me.

This case is totally different -- Patrick substantially explained the reason he reached the conclusion he did, gave all the information needed to verify it, and she agreed with his reasoning even though it was obviously incorrect. The whole point of the discussion was to protect against indirect Pirate exposure and they agreed that if that Patrick had no direct Pirate exposure, that somehow meant there was no indirect exposure.

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Well indeed there is a double argument from Patrick

Patrick says that:

Quote

(Situation) - If BS&T defaults,
(Claim) - I can cover your deposit
(Argument for the result) - Because he has enough assets to cover it (False, were found to not have the value Patrick thought)
(Sub argument) - Mainly because he is not invested in BS&T

Doctor says that:

Quote

(Situation) - If you proceed with the test,
(Claim) - You won't pay for it
(Argument for the result) - Because the insurer will pay for it (False, he did not pay as the doctor thought.)
(Probable sub argument that he did not disclosed, it does make a difference) - Because I recall this insurer insuring this test

In Patrick case's, YES the depositors should have been VERY wary of the sub argument as it was fully disclosed because it was dubious that his claim is true. But it is not a common mistake because the depositor for Patrick or you with your doctor neither made any claim to the effect that what the other party claimed was factual and a requirement for the contract. They have to make the same claim.

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As I stated, what was agreed upon and claimed by Patrick is that Patrick:
- Accept deposits
- Pay X% on deposit
- Can cover the deposits

The arguments are purely for convincing the other party as to why the party is confident in his claims he promised you and as to why you should proceed with what the party offers you (To make a deposit/To make the test). The arguments brought forward are not contractual clauses required for the contract to be valid. In either case, nor the Doctor or Patrick or you or the depositor say the claim will be executed IF the argument holds to be found true/sufficient to guarantee the promise. Which would then be a contractual clause that it is required if they insisted the claimed would be delivered upon IF another specific scenario holds to be true.

Arguments are purely a convincing mechanisms that even if true, do not guarantee the claim to be executable.

Suppose this:
A borrower wants to loan 20000$ at 14% yearly interest. The lender asks him why he should grant him the loan. The borrower arguments, without making false statements, that:
- I have a good credit rating. (true)
- I have a stable job. (true)
- I have enough assets to cover the loan should problems arise. (true)

The lender answers by "fair enough, works for me, I'll grant you the loan". Yet the arguments do not make the clause that the borrower will repay true.

The borrower default on his debt and insist you share the loss on the premise that there is a common mistake because he did not lie and both expected his arguments to be true which they were and deemed sufficient to grant the loan/contract and that now the loss is irrecoverable, so the loss is to be shared. The borrower keep his current lifestyle and doesn't depart with his non-essential possession to pay his debt just as Patrick did although he said he could cover the deposit.

You would be able to void full responsibility on any contract's clauses if you ever made any argument that was true yet didn't guarantee the clauses because the other party was convinced by those arguments. (The other party never said those arguments were required to be true to execute the contract or were what guaranteed the promise made by the borrower. They merely agree to be convinced by those arguments.)

As you said, Mircea agreed with Patrick's reasoning. A bank might have agreed with the borrowers's reasoning. It does not imply that neither agree that the arguments absolutely makes the claim possible and is 100% correct all the time. Just that they were convinced that the borrowers could reasonably be expected to be able to deliver his claim based on those arguments.

If the borrower gave an extremely ridiculous argument that he could repay because "His dog is brown (True)", you wouldn't have made a common mistake. You would have put yourself in the situation. You would have been incredibly stupid to be convinced by such a statement. But you did not made a common mistake as per contract law. The borrower is fully obligated to repay the loan because that's what he claimed he would do repay it and neither party added a sub-clause that this repayment was directly dependent on "His dog being brown" making "Repayment of the loan" possible.

The people who gave Patrick his funds made a risk misjudgement when they got convinced by his arguments. They did not make a common mistake.

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A common mistake requires both parties to make a factual claim to be considered a common mistake. Not one party making a claim and the other accepting the claim or accepting the arguments for that claim as convincing.

I gave an excellent example:
Buyer: I need cherries delivered in Washington. Can you deliver in Washington?
Supplier: Yes, I deliver anywhere in Washington.
Buyer: Perfect. *Pay's right away*
*Supplier imports cherries right away.*
Supplier: I have your cherries ready. What is your address?

Upon which the seller and the buyer realize the supplier is in the state of Washington and can only deliver there, and that the buyer lives in Washington D.C. and that the cherries would be impossible to deliver as planned considering the supplier's means to deliver which do not currently extend outside of the state of Washington.

There is common mistake when both parties made the claim to each other and each parties accepted it from each other, but the claim is not precise enough or is false for both. There is a common claim but also a common mistake as to what that premise making the contract executable means and it renders the contract impossible to execute as a result. There is no such common mistake in Patrick's case.

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I stress again that I am in no way saying the depositors didn't make the mistake of more or less blindly listening to Patrick. I am in no way saying that they didn't put themselves in that situation by lending somewhat carelessly to someone they assumed to be trustable. Because they made that mistake and are now in this situation. This situation would hardly be enforceable in court in any case.

I am not shifting blame away from depositors or that they didn't make bad decisions. I am just stating that common mistake (as per contract law) does not apply and that Patrick is still contractually obliged to cover the deposits in full merely because he promised it. And that he should get a scammer tag until this case is resolved too because he's unwilling to depart with his current non-essential personal assets to cover his debt.

I am not stating that this situation is fair for Patrick or that depositor didn't commit any mistake or that the contract would be enforceable in courts (mostly because I agree with your argument about usury rates which renders the contract somewhat null to start with.) I am simply insisting that according to current laws in most jurisdiction, if the contract had not been invalid, he would fully own the deposits to depositor and common mistake would not be invokable.