1-MutualAssent_Lucy v Zehmer

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					Mutual Assent – Subjective and Objective Intent Notes

Lucy v. Zehmer, Supreme Court of Virginia, 1954

P didn’t sign the contract – could he have gotten out of it? “Requiring defendant to perform the contract in accordance with the prayer of the bill” – does this mean, land should be sold?? Seems kind of harsh that the contract must be executed – understandable if some kind of compensation is required. No damages to P. Why wasn’t relevant that D said: “this is liquor talking. I don’t want to sell” EDS promissory note. I agree verbally (and shake on it) with car salesman to buy a car but I can later change my mind – is that breach?

Facts
P entered D’s restaurant and made a proposal to buy a piece of land from D for $50K. D. seemed to go along with the proposal. D. told his wife that he was playing a prank on P. However P. did not hear or know that. P believed he was negotiating a contract in earnest. The negation process seemed to take about 45 minutes during which the terms of the contract were negotiated and written on a piece of paper and signed by D. P had his brother agree to put up half and had an attorney look into the title.

Procedure
P. brought a suit against D asking that D perform the contact. A lower court held that the D failed to establish their rights to specific performance. Not clear was happened at the appeals court or trial court. P. appeals decision to the supreme court.

Issue
Does the agreement between P and D constitute a binding contract? Must D perform the contract?

Plaintiff might argue
We made a deal… Now they’re trying to get out of it.

Defendant might argue
I was drunk and was playing a prank on him… I told him I didn’t wanna sell

Law
A person is legally bound by the intentions corresponding to the reasonable meaning of his words. A contract is established when there is an offer and acceptance

How about verbal agreements? Are they enforceable? (Problem 2)

Reasoning
D. can not claim that he was just jesting when his conduct and words would warrant a reasonable belief by P. that he intended a real agreement. P. believed that was contract represented a serious business transaction and a good faith sale and purchase of a farm. D seemed able to understand the nature and consequences of the contract (not drunk enough)

Nutshell (p20): If it is determined that neither party subjectively intended to be bound then there should be no contract found.

Holding
Lower court’s holding for the defendants was reversed. Court ordered that D perform the contract What does: the complainants have specific performance of the contract sued on. What does: “requiring defendants to perform the contract in accordance with the prayer of the bill”

Mutual Assent – Subjective and Objective Intent

Lucy v. Zehmer, Supreme Court of Virginia, 1954 Issue: Does the agreement between P and D constitute a binding contract? Must D perform the contract?

Reasoning

Rule
A contract is established when there is an offer and acceptance

Facts
P entered D’s restaurant and made a proposal to buy a piece of land from D. D. seemed to go along with the proposal. D. told his wife that he was playing a prank on P. However P. did not hear or know that. P believed he was negotiating a contract in earnest. The negation process seemed to take about 45 minutes during which the terms of the contract were negotiated and written on a piece of paper and signed by D.

D. can not claim that he was just jesting when his conduct and words would warrant a reasonable belief by P. that he intended a real agreement. P. believed that was contract represented a serious business transaction and a good faith sale and purchase of a farm.

A person is legally bound by the intentions corresponding to the reasonable meaning of his words.

Held: Lower court’s holding for the defendants was reversed. Court ordered that D perform the contract. Procedure: P. brought a suit against D asking that D perform the contact. A lower court held that the D failed to establish their rights to
specific performance. Not clear was happened at the appeals court or trial court. P. appeals decision to the supreme court.

P might argue: We made a deal… Now they’re trying to get out of it. D might argue: I was drunk and was playing a prank on him… I told him I didn’t wanna sell.


				
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