Is "What is built upon error is error" a binding Sharia principle?

This statement is correct and a sound principle. It means that what is built upon corrupt premises leads to corrupt outcomes, for a تابع (dependent) takes the ruling of that which it depends on. An example of this is a reconciliation that was based on something unlawful; it is corrupt and void. They cite as evidence the hadith of the hired man (al-Asif) who committed adultery. The Prophet, peace and blessings be upon him, invalidated the reconciliation that had taken place between his father and the woman's guardian to waive the prescribed punishment for him in exchange for a hundred sheep and a maidservant, and he carried out the punishment on him.