This argument is distinct from unconscionability as reviewed above.

Rectification is an unusual remedy and is difficult to obtain. In the case of a mutual mistake, the moving party must demonstrate (1) the written document does not represent the actual agreement that was reached between the parties and (2) this real common agreement continued up until the time when the written agreement was executed. ¹

Rectification can also be obtained where the mistake is not mutual, but rather one-sided or a unilateral mistake. The Ontario Court of Appeal dealt with this issue, ²dealing with a fact situation in which the other party was aware of the mistake. The court, in this instance, noted that the law had eased the burden on the party asserting the mistake. It was no longer required to prove an overt attempt to take advantage of the position of the mistaken party by showing conduct nearing fraud or sharp practice.

It is sufficient that one party has been mistaken and fails to alert his contracting party, where to do so would be inequitable and either benefit the wrongdoer or prejudice the victim. The remedy has also been extended to a situation where the wrongdoer does not have actual knowledge but “has good reason to know of it and to know what was intended”.

The objective of the trial judge is restore the parties to their true agreement, not to amend the terms due to an error in judgment.

The error have been innocently effected or the subject of a fraud. What is critical to the test is that the wrongdoer must be shown to have relied upon the error inherent in the document in such a manner which could be seen as “fraud or the equivalent of fraud”. ³

The court may consider in the exercise of its discretion the factor that the party seeking the equitable remedy was negligent in its failure to note that the written agreement did not reflect the true terms. This being said, generally speaking, all cases seeking rectification will involve to some degree an error made by the plaintiff in not assuring that the final agreement reflected the actual terms. The court retains discretion to deny the remedy where “it would be unjust to impose on a defendant a liability which ought more properly to be attributed to the plaintiff’s negligence”.⁴

Given the test of fraud, it is unlikely that such a defence would be commonly successful.

An example of a fact situation in which rectification of an employment contract was allowed is a 2002 B.C. Supreme Court decision. ⁵

The court concluded that a fixed term employment agreement of 3 years was reached by exchanged correspondence of February 13, 1995, which was not replicated in the signed employment agreement which followed. The plaintiff had not read the final document. The court relied upon the above referenced passage from the Ontario Court of Appeal decision in Downtown King West and concluded that rectification was to be awarded as the final document did not represent the common intention of the parties. It is to be noted that the court dismissed the action as the plaintiff had not proven a damage claim.