Svanosio v McNamara (1956) 96 CLR 186

Facts: Sale by McNamara (M) to Svanosio (S) of hotel and land, together with the hotel’s liquor licence and goodwill, for a price of £5,000. After conveyance of title, S discovered that about one-third of the hotel building stood on Crown land. M had not been aware of this, so both parties were under the mistaken impression that M had title to all of the land. S claimed:

(i) a declaration that the contract was entered into under a common mistake,

(ii) a declaration that the contract was void, or

(iii) an order setting aside the contract

Held: No relief available.

Held (Dixon CJ and Fullagar J, at 195-6): '[T]here may be cases of “mistake” in which it would be so inequitable that a party should be held to [their] contract that equity would set it aside. ... But ... it is difficult to conceive any circumstances in which equity could properly give relief by setting aside the contract unless there has been fraud or misrepresentation or a condition can be found expressed or implied in the contract. ... In the present case there was no fraud or misrepresentation, and the position must depend on the terms, express and implied, of the contract.’