Hill's, Inc. v. William B. Kessler, Inc.
246 P.2d 1099, 1952 Wash. LEXIS 412, 41 Wash. 2d 42 (1952)
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Rule of Law:
A seller's communication to a buyer assuring "very best attention" to an order, combined with a subsequent letter attempting to "cancel" that order, can be interpreted together as an objective manifestation of acceptance, thereby forming a binding contract.
Facts:
- On May 16, 1950, Hill’s, Inc., a retailer, ordered thirty-four men's suits from a clothing manufacturer (the defendant) using a printed form supplied by the manufacturer's salesman.
- The order form stipulated that it would not become a binding contract until accepted by an authorized officer of the defendant in Hammonton, New Jersey.
- On May 23, 1950, the defendant sent a form letter to Hill's, Inc., stating, "You may be assured of our very best attention to this order."
- On July 18, 1950, the defendant sent a second letter to Hill's, Inc., stating it was necessary to "cancel this order" due to previous commitments to other stores in the area.
- The defendant's cancellation occurred after the general time period for placing orders for fall suits had passed, making it impossible for Hill's, Inc. to procure comparable suits from another source for its fall trade.
Procedural Posture:
- Hill's, Inc. (plaintiff) brought an action against the defendant manufacturer in a trial court, seeking damages for loss of profits.
- The trial court found in favor of the plaintiff, Hill's, Inc., and awarded a judgment for damages.
- The defendant (appellant) appealed the trial court's judgment to this appellate court.
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Issue:
Does a seller's letter assuring a buyer of its "very best attention" to an order, combined with a subsequent letter attempting to "cancel" that same order, constitute an acceptance that forms a binding contract?
Opinions:
Majority - Mallery, J.
Yes, the seller's communications collectively constitute an acceptance, forming a binding contract. The court reasoned that the initial letter assuring "very best attention" implies more than merely considering the offer; it suggests an intention to fill the order. This interpretation is confirmed by the defendant's subsequent letter of July 18, which attempted to "cancel" the order. The use of the word "cancel" is a recognition that a contract existed, as one cannot cancel an agreement that was never made. The court also dismissed the defendant's argument that the employee who signed the letters was unauthorized, applying the doctrine of apparent authority because the company placed her in a position where a third party would be justified in assuming she had the authority to act. Therefore, the defendant's actions created a binding contract which it then breached.
Concurring - Donworth, J.
Yes, a binding contract was formed. The concurrence agrees with the outcome but for a more narrow reason. The defendant's letter of July 18, 1950, which explicitly stated an intent to "cancel" the order, was by itself a clear recognition that a contract already existed between the parties. This admission is sufficient on its own to affirm the judgment that a contract had been formed and breached.
Analysis:
This decision illustrates that contract acceptance can be established through the totality of communications and conduct, not just explicit words of acceptance. The court's focus on the seller's use of the word "cancel" serves as a key precedent, showing how a party's later actions can retroactively define the meaning of earlier, ambiguous statements. This holding discourages the use of equivocal language by sellers to maintain flexibility at the buyer's expense. Furthermore, the application of apparent authority reinforces that principals are bound by the actions of agents whom they place in positions that would lead a reasonable person to believe they possess authority.
