Lenawee County Board of Health v. Messerly

Lenawee County Board of Health v. Messerly, 331 N.W.2d 203 is a US contract law case decided by the Supreme Court of Michigan. It used a risk of loss analysis to justify the denial of rescission as a contract remedy despite the presence of mutual mistake.

Facts

The Pickles bought a three-unit dwelling for use as a rental property from the Messerlys, only to discover that an illegal septic tank had contaminated the ground.
Raw sewage was seeping out of the ground. Lenawee County condemned the property, making it worthless to the buying party Pickles. So, Pickles sought rescission and Messerly sought a deficiency judgment.

Judgment

The Supreme Court of Michigan backed away from the precedent of Sherwood v. Walker in favor of the Restatement (Second) of Contracts, and relied on an "as is" clause in the land contract to deny rescission.