Lucy v. Zehmer

Purchasers sued for specific performance of a written contract to convey a farm. The trial court denied relief, finding no binding contract. Purchasers appealed.

After an evening of drinking, Zehmer wrote and signed an agreement to sell the Ferguson farm to Lucy for $50,000. The writing was rewritten to include Zehmer's wife's signature and handed to Lucy. Zehmer later claimed the whole exchange was a bluff.

Whether an outward manifestation of assent creates a binding contract despite a party's secret, unexpressed intention to jest.

The law imputes to a person an intention corresponding to the reasonable meaning of that person's words and acts. Mental assent is not required where words and conduct reasonably manifest agreement.

Yes. A binding contract was formed; specific performance is granted.

The forty-minute discussion, the rewriting of the instrument, the reading and delivery, and the ensuing insistence on title examination all demonstrate a serious business transaction.

Intoxication short of incapacity to comprehend the transaction does not void assent.

Objective theory of contract; Restatement (Second) § 20 misunderstanding analysis.

Reversed and remanded with instructions to grant specific performance.

No separate opinions were filed.

Pitfall: the drinking facts are a distractor. The tested point is objective manifestation, not capacity.

The canonical American statement of the objective theory of assent in first-year Contracts.

Embry v. Hargadine, McKittrick Dry Goods Co., 105 S.W. 777 (Mo. App. 1907).

Leonard v. Pepsico, Inc., 88 F. Supp. 2d 116 (S.D.N.Y. 1999).