Rancher Hiram Walker purchased Rose, a cow, for $850 in the hope that she would breed calves. After several years of effort, Walker concludes that Rose cannot bear calves and agrees to sell her to T.C. Sherwood for $80. When Sherwood came to collect Rose, however, the parties discovered that the cow was in fact pregnant. A confirmed breeder is worth about $1,000. Walker refused to part with Rose, and Sherwood sued for breach of contract. A court may determine that the contract between Walker and Sherwood is voidable due to what defensive legal theory?

A mutual mistake in a contract is a situation that arises when the parties in a contract make the same mistake in reference to a significant fact in the contract. i.e., they are mutually ignorant of a fact of the contract.

Had they both known about that mistake, they might not have gone into the contract so the contract is voidable in this scenario.

Both Walker and Sheerwood were mutually mistaken about the fact that Rose was pregnant when they went into the contract so this contract is voidable by this theory.