Law · Legal Aptitude
A mistake as to a fact essential to the agreement, common to both the parties (e.g., both bank and borrower are unaware that the mortgaged property was destroyed by fire before the execution of the deed), renders the resulting contract:
- 1A Contract of Indemnity.
- 2Void ab initio (void from the beginning).✓
- 3Valid and enforceable.
- 4Voidable at the option of the bank.
Correct answer
Void ab initio (void from the beginning).
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