Where two parties negotiate and contract face to face, in each other's actual presence, the law generally presumes that each party intends to contract with the physical person actually standing before them, regardless of what false identity that person may have claimed to hold. A contract induced by a fraudulent misrepresentation as to identity, made face to face between parties who are physically present with each other, is therefore generally treated as voidable, rather than void, at the option of the deceived party, since the deceived party did, in fact, genuinely intend to contract with the very person physically present, even though mistaken about that person's true identity.

This general rule differs where the parties never actually meet or deal with each other in each other's physical presence, such as where contracting occurs entirely through written correspondence, and the deceived party's intention was to contract only with a specific, identified person other than the one physically making the fraudulent claim, with the identity of that specific other person being fundamental to the deceived party's decision to contract at all. In such a case, where the mistake as to identity is sufficiently fundamental, and the deceived party can show they intended to contract with a specific, different person and not with the actual fraudulent party at all, the resulting contract may be treated as void from the outset, rather than merely voidable.

The practical significance of this distinction becomes especially important once goods have passed to the fraudulent party, who then resells those goods to an innocent third party before the original deception is discovered. Where the original contract is merely voidable, rather than void, the fraudulent party held a genuine, if voidable, title to the goods until the contract was actually avoided, meaning a title passing to an innocent third party purchaser before avoidance generally remains valid and protected. Where the original contract was void from the outset, however, no title ever passed to the fraudulent party at all, meaning that party had nothing to pass on, and even an entirely innocent third party purchaser generally acquires no valid title to the goods.

Courts examining a claim of mistaken identity look closely at whether the deceived party can show they intended to deal only with a specific, identified person, and that this specific identity was fundamental to their decision to contract, rather than merely mistaken about some other attribute or quality of the person they were, in fact, willing to deal with regardless of true identity.