Lonergan v. Scolnick
129 Cal. App. 2d 179 · California Court of Appeal · 1954
Facts
The defendant placed an ad in a Los Angeles paper for a 40-acre tract in Joshua Tree, stating "need cash, will sacrifice." In response to an inquiry, the defendant wrote to the plaintiff on March 26, describing the property, stating a "rock-bottom price" of $2,500 cash, and noting it was a "form letter." The plaintiff replied on April 7, asking for more details and suggesting an escrow agent "should I desire to purchase the land." The defendant responded on April 8, confirming the property, agreeing to the escrow agent, and stating, "If you are really interested, you will have to decide fast, as I expect to have a buyer in the next week or so." On April 12, the defendant sold the property to a third party for $2,500. The plaintiff received the defendant's April 8 letter on April 14 and on April 15, wrote to the defendant stating he would open escrow and deposit $2,500 "in conformity with your offer." On April 17, the plaintiff started an escrow, depositing $100 and agreeing to furnish the remaining $2,400 later.
Procedural history
The plaintiff initiated an action for specific performance or damages, alleging a contract for the sale of land. The trial court, after considering an agreed statement of facts, found that no contract was entered into between the parties. Judgment was entered for the defendant, from which the plaintiff appealed.
Issue
Was a contract formed between the plaintiff and defendant for the sale of the 40-acre tract of land? Specifically, did the defendant's correspondence constitute an offer that the plaintiff could accept?
Holding
No, a contract was not formed between the parties. The defendant's communications did not constitute an offer, and therefore, the plaintiff could not have accepted one.
Rule
A contract requires a meeting of the minds, typically evidenced by an offer and acceptance. Under Restatement of Contracts Section 25, if the recipient of a promise or manifestation of intention knows or has reason to know that the maker does not intend it as an expression of fixed purpose until further assent is given, then no offer has been made. The court reasoned that the defendant's letters, including the "form letter" and the statement about expecting another buyer, indicated an intent to solicit interest rather than make a definite offer, requiring further assent from the defendant.
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