GENERAL LEGAL PRINCIPLES; CONTRACT ENFORCEMENT/ INTERPRETATION – General Principles of Contract Interpretation
Single Topic for Decision 1883E
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1404.03000 – General Principles of Contract Interpretation
A party seeking rescission based on a unilateral mistake of fact must show that: (1) the party made a material mistake regarding a basic assumption of the contract; (2) the party seeking the rescission did not neglect a legal duty or otherwise fail to exercise ordinary diligence; and (3) the mistake was so significant that enforcement of the contract would be unconscionable. PERB has long shown a strong interest in labor relations stability and is loathe to upset working relationships. Accordingly, rescission requests will only be granted in extraordinary cases. (Once a final collective bargaining decision is reached, it takes precedence over and subsumes prior tentative agreements, which are then no longer in effect.