Richards v. Flower
14 Cal. Rptr. 228, 1961 Cal. App. LEXIS 1692, 193 Cal. App. 2d 233 (1961)
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Rule of Law:
A mere quotation of price or an expression of willingness to consider a sale at a particular sum, without language indicating a definite intent to be bound, constitutes preliminary negotiation or an invitation for an offer, rather than a legally enforceable offer capable of acceptance.
Facts:
- On January 15, 1959, Harriet Richards wrote to Flowers, expressing interest in buying his lot on Gravatt Drive directly and requesting the "cash price you would expect to receive."
- On January 19, 1959, Flowers replied to Mrs. Richards, stating he would deal directly if their 'offer' was in cash and that he "expect[s] to receive $4,500.00 for this property," concluding with "Please let me know what you decide."
- On January 25, 1959, Mrs. Richards sent a telegram to Flowers, stating that she and Keith Richards "have agreed to buy your lot on your terms" and would handle the transaction through a local title company.
- On February 5, 1959, Flowers entered into an agreement to sell the same property to the interveners, the Suttons, through a real estate brokerage firm.
- The Richards were subsequently advised of the Sutton transaction, but claiming a valid contract, called upon Flowers to deposit his deed, which he refused, denying any contract with them.
Procedural Posture:
- Keith and Harriet Richards commenced an action against Flowers in state trial court, seeking specific performance of their alleged agreement for the sale of the real property.
- The Suttons intervened in the action, asking the trial court for specific performance of their contract to purchase the property from Flowers.
- The trial court interpreted the series of communications between Richards and Flowers without the aid of any extrinsic evidence.
- The trial court found that Flowers had made an offer capable of acceptance, but that the Richards' telegram of acceptance did not comply with the California statute of frauds, as they had not given the telegraph company written authorization.
- The trial court also found that there was a valid contract between Flowers and the Suttons.
- Judgment was entered in favor of defendant Flowers with respect to the Richards’ claim and for interveners Suttons on their demand for specific performance.
- Plaintiffs Keith and Harriet Richards appealed the judgment to the California District Court of Appeal.
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Issue:
Does a property owner's response to an inquiry about selling property, stating the price they 'expect to receive' and inviting the inquirer to 'Please let me know what you decide,' constitute a definite offer capable of forming a binding contract upon acceptance?
Opinions:
Majority - Shoemaker, J.
No, a property owner's response stating the price they "expect to receive" and asking the inquirer to "let me know what you decide" does not constitute a definite offer capable of forming a binding contract. The court reasoned that there is a critical distinction between an offer and preliminary negotiations. Flowers' letter was a direct response to the Richards' inquiry asking him to suggest a sum, which places it in the category of preliminary negotiations, rather than a definite offer. The language, specifically Flowers' statement about dealing directly "as long as your offer would be in cash," indicated an anticipation of a future offer from the Richards, not an offer made by him. Furthermore, the phrase "I expect to receive $4,500.00" merely expressed an indication of the lowest price he was willing to consider, functioning as a "mere quotation of price" and not a firm offer to sell. The court distinguished this case from others where language such as references to a "sales contract" or demands for "immediate acceptance" evinced an intent to enter into a binding legal obligation. The phrase "Please let me know what you decide" lacks such established contractual meaning and could equally indicate a desire to know if the buyer intended to make a further offer or discontinue negotiations. Since no offer was ever made by Flowers, no contract could have been formed with the Richards, rendering it unnecessary to address issues such as the statute of frauds or specific performance.
Concurring - Kaufman, P. J., and Draper, J.
Kaufman, P. J., and Draper, J., concurred in the judgment, agreeing with the majority's conclusion that no offer was made by Flowers.
Analysis:
This case is significant for clarifying the fundamental principles of offer and acceptance in contract law, particularly the distinction between an invitation to negotiate and a binding offer. It underscores that objective intent to be bound, as evidenced by clear and definite language, is paramount in forming a contract. Future cases will cite this ruling to argue that a property owner's mere statement of an expected price, even in response to a direct inquiry, typically serves as an opening for negotiation rather than creating the power of acceptance. This prevents parties from being unintentionally bound by informal communications, highlighting the importance of precise legal terminology when entering into significant transactions.
