Bert Allen Toyota, Inc. v. Grasz
909 So. 2d 763, 2005 WL 2009386, 2005 Miss. App. LEXIS 576 (2005)
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Rule of Law:
A contract will be enforced according to its clear and unambiguous written terms, even if one party made a unilateral mistake in calculation, especially when that party was negligent in failing to discover the error. A unilateral mistake does not justify rescission of a contract if the mistaken party failed to exercise reasonable care.
Facts:
- Horst Grasz negotiated with Kevin Gabbert, a sales manager at Bert Allen Toyota, to purchase a 2003 Toyota Tacoma.
- Grasz, who was known to the dealership as a tough negotiator, stated that he was unwilling to spend more than $15,000.
- Gabbert offered to sell the truck for a price based on a formula of $16,951, less a $1,000 rebate, plus taxes and fees.
- Gabbert entered these figures into a computer, which incorrectly calculated the final price as $15,017.50, which was $2,000 less than the correct price of $17,017.50.
- The resulting sales agreement listed the final price as $15,017.50 in four separate places; Gabbert circled this price and wrote "everything" below it.
- Grasz accepted the offer and paid a $500 deposit for the specially ordered truck, and the agreement noted "$14,517.50 due @ delivery."
- When the truck arrived approximately four weeks later, Gabbert discovered the error and demanded Grasz pay the higher price of $17,017.50.
- Grasz refused to pay the additional amount, and Bert Allen Toyota refused to deliver the truck at the price stated in the agreement.
Procedural Posture:
- Horst Grasz filed a complaint against Bert Allen Toyota, Inc. in the Harrison County Chancery Court (a trial court) seeking specific performance of the sales agreement.
- The chancellor entered a judgment in favor of Grasz, finding a clear and unambiguous contract existed for the price of $15,017.50.
- The trial court ordered Bert Allen Toyota to specifically perform the contract by supplying Grasz with an unused 2003 Toyota Tacoma at that price.
- Bert Allen Toyota, as appellant, appealed the trial court's judgment to the Court of Appeals of Mississippi, with Horst Grasz as appellee.
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Issue:
Does a unilateral computational mistake made by a seller, resulting in a lower written price on a sales agreement, render the contract unenforceable or subject to rescission when the seller was negligent in failing to detect the error?
Opinions:
Majority - Chandler, J.
No, a unilateral computational mistake made by a seller does not render the contract unenforceable or subject to rescission when the seller was negligent. A court will enforce a contract based on its clear written terms despite one party's unilateral mistake if that party did not exercise reasonable care. The court found that a valid contract was formed because there was a meeting of the minds on the essential term of price, which was clearly and unambiguously stated as $15,017.50 on the written agreement. The court rejected the dealership's claim of mutual mistake, finding that Grasz was only concerned with the final "bottom line" price, not the underlying calculation. The dealership's error was a unilateral mistake, and rescission is not an appropriate remedy because the dealership was negligent; the sales manager failed to exercise reasonable care, as he was aware the computer had made errors in the past and still did not verify the calculation. Under the "four corners" test, the contract was unambiguous as the price was stated multiple times, and any ambiguity is construed against the drafter. While the contract is valid, the remedy of specific performance is remanded to the lower court to determine if it is still feasible to supply an unused 2003 truck.
Analysis:
This case reinforces the principle that courts strongly favor enforcing clear, written agreements, particularly in commercial settings. It establishes a high bar for a party seeking to rescind a contract based on its own unilateral mistake, placing a heavy burden on that party to prove it exercised reasonable care. The decision serves as a significant warning to businesses that they are responsible for the accuracy of the contracts they draft, even when relying on computer systems, as negligence can prevent them from avoiding an unprofitable error. Future cases involving clerical or computational mistakes will likely look to this decision to analyze whether a mistaken party's negligence precludes them from obtaining equitable relief.
