Equitable remedy of Rectification

1. Rectification (Reformation)
Introduction
 Equitable remedy by which the court rectifies or correct an error in an
instrument or document.
 It is only used to correct an error to improve upon the document or the ag’t to
reflect the parties intention.
 It is not for the purpose of correcting a mistake in entering into an ag’t but
rather correct an error contained in the ag’t
 In Mackenzie v Coulson (1869) L.R. 8 Eq. 368 James, V.C stated “Courts of Equity
do not rectify contracts; they may & do rectify instruments purporting to have
been made in pursuance of the terms of Contracts. But it is always necessary for a
Plaintiff to shew that there was an actual concluded contract antecedent to the
instrument which is sought to be rectified; and that such contract is inaccurately
represented in the instrument ”
 This remedy is available to all instruments including those in unilateral
transactions, except wills.
 It is a discretionary remedy & an action has to be brought be pleaded specifically
or claimed.

2.  Rectification is granted either b’cos of a mutual mistake or unilateral mistake
or b’cos the instrument was procured by fraud but rescission would not be the
appropriate means to deal with it
Common Mistake
 Rectification may be usually entertained if there is a mistake in reducing
into writing an antecedent ag’t & the mistake is common to all the parties
involved.
 Where the Plaintiff labour under a mistake but the ag’t expresses the
intention of the defendant then there is no common mistake hence no
rectification.
 Common mistake is therefore a basic requirement, however, even in the
presence of common mistake rectification is not automatic.

3. Condition precedents for Rectification
 There must be in existence an antecedent ag’t b/n the parties, or a definite
intent if it be a unilateral transaction
 That the antecedent ag’t or intention was & remained in force at the
material time of the execution of the instrument which purported to
express the ag’t or intention
 That by reason of the mistake in expressing the ag’t or intention in writing,
the instrument fails to accurately reflect the correct ag’t or intention
 That the rectification prayed for will remove the discrepancy b/n the
instrument & the correct antecedent ag’t, or intention, so as to give effect
to the true ag’t or intention

4. Per Lord Denning in Frederick E. Rose(London Ltd v William H. Pim [1953] 2 Q.B
450@ 461
“Rectification is concerned with contracts & docs, not with intentions. In order
to get rectification it is necessary to show that the parties were in complete
ag’t on the terms of their contract, but by an error wrote them down wrongly;
& in this regard, in order to ascertain the terms of their contract, you do not
look into the inner minds of the parties – into their intentions – any more than
you do the formation of any other contract. You look at their outward acts, that
is, at what they said or wrote to one another in coming to their ag’t, & then
compare it with the document which they have signed. If you can predicate
with certainty what their contract was and that it is, by common mistake,
wrongly expressed in the document, then you rectify the document; but
nothing less will suffice.”

5. Unilateral Mistake
 Gen. Rule: rectification will not be granted for a unilateral as opposed to
mutual mistake.
Exceptions:
 Unilateral mistake is as a result of fraud, -
 fraud including a false statement of fact knowingly or recklessly made, or made w/o
belief in its truth, with the intent that it be relied upon by the representee & actually
relied upon by him.
 Not necessary that misrepresentation be made with corrupt motive or intent to
profit from it
 Still fraud even if the other party could have independently ascertained the truth
 Fraud may also be inferred from what one party has not said rather than what was
said
 The other parties (defendant) encouraged the plaintiff/Applicant’s unilateral
mistake (estoppel)

6. Inadequate Alternative Remedy
 Equity will not intervene by way of rectification if there is alternative
remedy that will conveniently deal with the issue.
 Inadequacy of a legal remedy is not a prerequisite to obtaining rectification
Alternative Solutions to correcting errors in instruments
Voluntary Correction
 If the parties agree that the instrument does not accurately reflect their ag’t,
it will be less costly & most expeditious for the them to voluntarily correct the
error out of court.
 This may be done by the insertion or striking out of the erroneous item & all
the parties signing the alterations & interlineations to avoid dispute on their
authenticity or in some circumstances the parties may execute a
supplementary instrument as an addendum to the original or execute &
register a new ag’t in substitution for the earlier one.

7. Collateral Contract
 Instead of rectification the parties may deal with the error by entering into a
collateral contract to give effect to their true original ag’t
Construction
 In some cases where there is an obvious clerical error or grammatical error
the court may correct such error by way of construction of the
instrument/document w/o recourse to a decree of rectification
Defences to Rectification
 Where rectification will affect the position of a 3rd party who has acquired
rights bona fide for value
 Delay may also bar a claim for rectification
 Acquiescence: Plaintiff has become aware of the mistake in the instrument,
he has adopted an attitude which the court would construe to mean the
Plaintiff has adopted the instrument with the mistake in it.
 Incapability of performance: where the contract is no longer capable of
performance. (Equity does nothing in vain