Schreiber v. Olan Mills

Superior Court of Pennsylvania
426 Pa. Super. 537, 627 A.2d 806 (1993)

ELI5:

Rule of Law:

A legally enforceable contract is not formed when one party attempts to unilaterally impose contractual obligations on another by declaring that unwanted conduct will constitute acceptance, as there is no mutual assent or 'meeting of the minds' to be bound.

Facts:

Olan Mills, a national portrait studio company, used telemarketing to solicit customers.
On November 29, 1989, a representative from Olan Mills telephoned S. Allen Schreiber.
Following the call, Schreiber sent a letter to Olan Mills demanding to be removed from their calling list.
The letter stated that any further telemarketing calls would be considered an entry into a contract for Schreiber's 'listening services' at a rate of $100 per hour.
After Olan Mills received the letter, its representatives made two more phone calls to Schreiber.
Schreiber subsequently sent Olan Mills an invoice for $479.00 for his 'listening services'.
Olan Mills refused to pay the invoice.

Procedural Posture:

S. Allen Schreiber (plaintiff) filed a breach of contract action against Olan Mills (defendant) in the arbitration division of the Court of Common Pleas.
Olan Mills filed preliminary objections in the nature of a demurrer, arguing that the complaint failed to allege facts sufficient to show the existence of a contract.
The trial court sustained the preliminary objections and dismissed Schreiber's complaint.
Schreiber (as appellant) appealed the trial court's dismissal to the Superior Court of Pennsylvania (the intermediate appellate court).

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Issue:

Does a party's continued, unsolicited contact with another party, after receiving a letter stating that such contact will be considered acceptance of a 'listening for hire' contract, create a legally binding agreement?

Opinions:

Majority - Popovich, Judge

No. A binding contract was not created because the essential elements of contract formation—offer, acceptance, consideration, and mutual meeting of the minds—were absent. The court reasoned that Schreiber's letter was not a genuine 'offer' to sell services, but rather a 'cease and desist' request intended to stop Olan Mills from calling. Likewise, the subsequent calls from Olan Mills were solicitations to sell portraits, not an 'acceptance' of Schreiber's purported contract for listening services. Since there was no mutual intention to enter into a contract for listening services, there was no 'meeting of the minds' and thus no enforceable agreement.

Analysis:

This decision reinforces the fundamental principle that contract formation requires genuine mutual assent and intent to be bound. It clarifies that a party cannot unilaterally impose contractual terms on another through a cleverly worded notice, especially when the communication's primary purpose is to terminate, rather than create, a relationship. The case serves as a clear example that conduct, to be deemed acceptance, must be in response to a genuine offer and reflect an intention to be bound by the proposed terms, not merely a continuation of unrelated prior behavior. This precedent limits the ability of individuals to create 'gotcha' contracts to penalize unwanted solicitations.

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