Chauvin v. Bohn

Supreme Court of Louisiana
411 So. 2d 442 (1982)

ELI5:

Rule of Law:

For a contract to sell immovable property to be enforceable under Louisiana law, the contract must be in writing and the writing itself must evidence the reciprocal consent of both parties to be bound to the specific terms of the sale.

Facts:

In the summer of 1976, John Kent Chauvin placed his Louisiana residence up for sale.
On August 15, 1976, C. Robert Bohn toured the home, offered Chauvin $80,000, and Chauvin orally accepted the offer.
Bohn then wrote a personal check to Chauvin for $4,000 as a down payment.
On the back of the check, Bohn wrote: 'Deposit for 13 Weinning Dr. Luling, La. Selling price $80,000.00 Balance $76,000.00.'
The parties agreed to wait for Bohn's attorney to return from a trip to draft the formal act of sale.
At Bohn's request, Chauvin removed the 'For Sale' sign from his front yard.
A few days later, Bohn's wife decided she did not want the house, and Bohn informed Chauvin that he was withdrawing from the sale.
Bohn subsequently placed a stop payment order on the $4,000 check.

Procedural Posture:

John Kent Chauvin filed suit against C. Robert Bohn in a Louisiana trial court, seeking to recover the $4,000 deposit as liquidated damages.
The trial court ruled in favor of Chauvin, finding that an enforceable contract existed and awarding him the $4,000.
Bohn, as appellant, appealed the judgment to the Louisiana Court of Appeal.
The Court of Appeal affirmed the trial court's decision in favor of Chauvin, the appellee.
The Supreme Court of Louisiana granted certiorari to review the decisions of the lower courts.

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Issue:

Does a notation on the back of a personal check given as a deposit for the purchase of a residence, combined with the vendor's endorsement and deposit of the check, satisfy the writing requirement for an enforceable contract to sell immovable property under Louisiana law?

Opinions:

Majority - Chief Justice Dixon

No, a notation on the back of a personal check made only by the prospective purchaser is insufficient to form a valid contract to sell immovable property, even if endorsed and deposited by the vendor. Louisiana Civil Code articles require that all contracts concerning transfers of immovables must be in writing. This requirement applies to both the offer and the acceptance. The mere endorsement and deposit of the check by Chauvin does not constitute a written acceptance that satisfies the codal requirements. The writing itself must demonstrate the reciprocal consent of both parties, containing language equivalent to 'I agree to sell' and 'I agree to buy.' Since the check notation only reflects Bohn's intent and contains no written manifestation of Chauvin's consent to sell, an essential element of the contract is missing from the writing. The court is prohibited from considering parol evidence to supply the missing elements of a contract for the sale of immovable property.

Dissenting - Justice Marcus

Yes, the writing on the check was sufficient to satisfy the legal requirement for a written contract. The notation on the back of the check constituted a valid written offer by Bohn. Chauvin's action of endorsing and depositing the check before Bohn communicated his withdrawal served as a written acceptance of that offer. Therefore, a valid and enforceable contract was formed, the $4,000 deposit constituted earnest money, and Bohn forfeited it when he receded from the agreement.

Dissenting - Justice Lemmon

Yes, the writing on the check created a valid contract. The essential elements of a contract to sell—the thing, the price, and the consent—were all present. The property address and the $80,000 price were clearly written on the check. The buyer's (Bohn's) consent was evidenced by his writing on the instrument. The seller's (Chauvin's) consent was unequivocally demonstrated by his taking possession of and depositing the check, as there is no other reasonable explanation for his actions. The lower courts correctly found that the seller consented to the buyer's written offer before the buyer withdrew it.

Analysis:

This decision reinforces the strict formality required for contracts involving immovable property in Louisiana's civil law system. It clarifies that 'a writing' requires more than just a memorandum from one party; the document itself must reflect the mutual consent of both parties to be bound. The court's refusal to consider extrinsic evidence (like the parties' actions or oral statements) to prove the seller's acceptance highlights the primacy of the written word in real estate transactions. This precedent serves as a strong caution against relying on informal documents like checks or receipts to secure a real estate deal, compelling parties to use formal, bilateral purchase agreements to ensure enforceability.

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