I can't grasp the distinction boldened in the quote below. How does
A believing ‘B to be not B’, and by implication someone else
A believing ‘B to be C, mistakenly believing that C exists’
? Mindy Chen-Wishart. Contract Law (2018 6 edn). p 262.
6.2.5 Non-existence of the identity assumed
According to this rule, A’s mistake as to B’s identity will only void their contract if A mistook B for another existing and identifiable party, C. If A merely believes that B is C who is non-existent or unidentifiable, the contract is only voidable. In King’s Norton Metal Co Ltd v Edridge, Merrett & Co Ltd (1897), K sent goods in response to an order from the fictitious ‘Hallam & Co’, written on headed stationery with a picture of a large factory and a list of overseas depots. The fraudster then sold the goods to E. Although the contract was in writing, the contract was only voidable for fraud because K intended to contract with the writer of the letter, being mistaken only as to his attributes; namely, solvency and respectability. The contract was not void for K’s mistake that it was contracting with ‘Hallam & Co’ because ‘Hallam & Co’ was nonexistent. ‘If it could have been shown that there was a separate entity called Hallam & Co . . . then the case might have come within the decision in Cundy v Lindsay.’
It is difficult to see why A and D’s rights should depend on whether A mistook B for another real entity or not. Furthermore, why was it not enough in King’s Norton that K believed that ‘Hallam & Co’ existed, when it did not? This supposed rule is subject to two exceptions, which require impossible distinctions to be drawn:
(i) A contract may be voided if A makes the additional mistake that C exists, even if C does not exist. But is there a meaningful difference between A believing ‘B to be not B’, and by implication someone else (contract not void); and A believing ‘B to be C, mistakenly believing that C exists’ (contract is void)? After all, in Lake v Simmons
(1927), the mistress of a wealthy customer, a widower, purchased some items from L, and then persuaded L to let her take away valuable pearl necklaces for her ‘husband’s approval’. L’s loss was only insured if no valid contract was made with the mistress. The court so found, although she was posing as a non-existent wife.
(ii) A contract is void when A believes that B who pretends to be C is not B (whether C exists or not), as long as there is an implied term that B is not B (Said v Butt (1920)), as where:
• an offer is made only to persons fitting particular descriptions which excludes B (eg ‘current students of a particular university’, or being ‘over 18 years’ to buy alcohol); or
• B may know from previous dealings that A is unwilling to contract with them (eg B is barred from a pub or a soccer match).
If the rationale is merely that B cannot accept an offer known not to be meant for her, then why did this not apply in King’s Norton Metal when the fraudster must have known that K had no intention of contracting with him?