Case 14-1 Lucy v Zehmer

Facts: Zehmer and Lucy have been trying to come up with an agreement on the sale of Zehmer's property. One evening Lucy goes over to the Zehmer's establishment and begins to discuss the sale of property. Lucy bets that Zehmer would not accept $50,000 for the property. Prior to drinking alcohol, Zehmer said he would accept $50,000, but that Lucy would not pay that amount for it. Later in the evening once intoxicated, they both signed a contract stating that an agreement was reached to sell the property for $50,000.

Issue: Whether or not the courts should decide if the physical expression of the parties exhibit their intent to enter into a binding contract or if a lack of the party's mental assent be taken into account?

Rationale: Zehmer signed the contract but yet whispered to his wife that it was a joke while intending for Lucy not to hear that it was a joke. Thus, Lucy, believing that the contract was made in good faith, did not take the contract to be a joke because the following day he had the money ready to purchase the property.

Conclusion: The courts must look at the physical expressions of the parties to determine the validity of a contract because "[i]t is immaterial what may be the real but unexpressed state of his mind" (363).

As a group, we agree with the court's rationale and conclusion because the fact that he signed the contract and whispered to his wife that it was a joke proves that Zehmer was aware of the actual agreement at hand. Any reasonable person would assume that should a contract actually be signed between two parties over the sale of a property in good faith, the contract is valid and enforceable.

Participants: Yesenia Barberena, Star Hughes, Mike Walker, Morgan Payne, Devon Seal, Qi Chen