Is rectification of a document when there is a mistake common between the parties?

British Columbia, Canada


The following excerpt is from Cox v. Crystal Graphite Corporation, 2007 BCSC 1429 (CanLII):

At para. 34 of Fraser v. Houston, Lowry J.A. put it in these words: 34 As a result, rectification of a document where there has been a mistake that is not common to both parties must be understood as having a different focus than the relief that can be employed when a mistake has been mutually made. The remedy affords relief against conduct on the part of the non-mistaken party that equity views as sufficiently unconscionable to warrant the remedy. The burden of proof resting on the party seeking relief is the same, but what must be established is quite different. What must be established is conduct on the part of the non-mistaken party that renders it unconscionable to permit that party to benefit from the agreement (such as would warrant rescission if that remedy were sought) and, in addition, that renders it unconscionable to resist the rectification of the written instrument even though the remedy will impose on the non-mistaken party an agreement that it did not intend to make at the time the instrument was executed. He goes on at para. 41 to conclude that: 42 In any event, a person who merely ought to have known that another was making a mistake cannot, without more, be said to have committed an equitable fraud. His position is not comparable to that of a person who has actual knowledge of the mistake being made. At least as a general proposition, commercial certainty must favour holding a party to an agreement it saw fit to execute over imposing on another party obligations it did not intend to assume, or depriving it of rights it did not intend to lose, on the basis that it ought to have known a mistake was being made.

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