Couturier v Hastie [1856]

Court: House of Lords

Facts: Couturier and Hastie entered into a contract for the sale of corn in transit, believing it existed and was deliverable. However, the corn had already decayed and been sold prior to contract formation. Couturier sought payment for the corn, claiming that Hastie acquired an interest in the goods.

Issue: Can a contract be valid if the subject matter no longer exists at the time of agreement?

Held: The contract was void as there was no subject matter at the time of agreement. The House of Lords ruled that the mutual mistake about the existence of the corn meant no valid consideration existed.

Key Judicial Statement: Lord Cranworth LC held that for a contract to be valid, there must be an actual existing subject matter; if it has perished before the contract, no obligation arises.

💡Leveluplaw: A contract is void if the parties are mistaken about the existence of the subject matter, as there is no valid consideration.