‘Principles of International Commercial Contract’(PICC) art. 3.2.1 equates a mistake relating to facts with a mistake relating to law. Identical legal treatment of the two types of mistake seems justified in view of the increasing complexity of modern legal systems. This article indicates that a mistake must involve an erroneous assumption relating to the factual or legal circumstances that exist at the time of the conclusion of the contract. Article 3.2.2 states the conditions necessary for a mistake to be relevant with a view to avoidance of the contract. Article 3.2.3 equates an error in the expression or transmission of a declaration with an ordinary mistake of the person making the declaration or sending it and thus the rules of article 3.1.4, article 3.2.2 and articles 3.2.9 to 3.2.16 apply also to these kinds of error. Article 3.2.4 is intended to resolve the conflict which may arise between the remedy of avoidance for mistake and the remedies for non-performance. Avoidance of a contract by a party on the ground of fraud bears some resemblance to avoidance for a certain type of mistake. Fraud may be regarded as a special case of mistake caused by the other party. Fraud, like mistake, may involve either representations, whether express or implied, of false facts or non-disclosure of true facts(Article 3.2.5). And next article permits the avoidance of a contract on the ground of threat(Article 3.2.6). Article 3.2.7 permits a party to avoid a contract in cases where there is gross disparity between the obligations of the parties, which gives one party an unjustifiably excessive advantage. Not only must the advantage be excessive, it must also be unjustifiable. Article 3.2.8 deals with situations, frequent in practice, in which a third person has been involved or has interfered in the negotiation process, and the ground for avoidance is in one way or another imputable to that person. Article 3.2.9 lays down the rule according to which the party entitled to avoid the contract may either expressly or impliedly confirm the contract. Article 3.2.10 deals with Performance of the contract as understood by the mistaken party Decision to be made promptly Loss of right to avoid and Damages. Article 3.2.11 states the principle that the right of a party to avoid the contract is exercised by notice to the other party without the need for any intervention by a court. Article 3.2.12 states Time limits, furthermore article 3.2.13 deals with situations where the grounds of avoidance affect only individual terms of the contract. Article 3.2.14 states the rule that avoidance takes effect retroactively. In other words, the contract is considered never to have existed. In the case of a partial avoidance under article 3.2.13 the rule applies only to the avoided part of the contract. Article 3.2.15 mentioned right of parties to restitution on avoidance, restitution in kind not possible or appropriate, the allocation of risk, compensation for expenses, and benefits. Article 3.2.16 deals with damages if ground for avoidance known to the other party, the measure of damages. Finally, Article 3.2.17 takes account of the fact that, apart from the contract itself, the parties, either before or after the conclusion of the contract, often exchange a number of communications of intention which may likewise be affected by invalidity.