BUS 206 Module 6 Case Analysis Theresa Goodson Southern New Hampshire University Professor Krystal Witter October 2023
The case of Lucy v. Zehmer involves Lucy's attempts to purchase Ferguson Farm from Zehmer over many years. To motivate Zehmer, Lucy bet that he wouldn't accept $50,000 for the farm. After both parties engaged in drinking, Zehmer wrote up a contract to sell the farm to Lucy. However, Zehmer later claimed that the contract was invalid as he was joking. He argued that there was no intent on his part to sell the farm. The trial court found in favor of the defendants, but Lucy won the case on appeal. The court reversed the ruling in favor of the plaintiff. "The mental assent of the parties is not requisite for the formation of a contract" (Kubasek et al., 2020) This was because Zehmer had signed the contract, indicating agreement even though he claimed it was a joke. Furthermore, Lucy had put down $5 to further seal the deal, which Zehmer accepted. The court found that Lucy was under the impression that the deal was fair and valid and upheld the contract. Therefore, Lucy was able to buy the land for $11,000. Zehmer contended that the mental assent or intention to enter into a binding agreement was missing in the case. Zehmer argued that he was joking and had no real intent to sell the farm for $50,000 to Lucy. The mental assent or intention element of contract law requires that parties entering a contract must possess the intent to be bound by their agreement. Without this intent, a contract may not be enforceable. Zehmer claimed that he made the contract under the influence of alcohol and that he intended it to be a joke. He argued that the agreement was not a serious one since he did not possess the necessary intention to form a contract. However, the court argued that the appearance and conduct of the parties indicated that both parties believed that they were entering a binding agreement. Therefore, despite Zehmer's claim that he was in jest, the court found that he exhibited the necessary manifestations of intent for Lucy to believe that they were entering into a binding agreement. Zehmer's signing of the contract, accepting the $5
from Lucy, and the absence of any indication that he was not serious, all worked to confirm to Lucy that he had a genuine intent to sell the farm to her. The court ruling in favor of Lucy, upholding the contract as binding, was reasonable and justified. The court emphasized that the outward expression of a person's intention, as manifested through their words and actions, is what matters in determining the validity of a contract. Even if Zehmer claimed he was joking, the evidence showed that Lucy believed it to be a serious business transaction. The court also noted that Zehmer had not indicated, prior to the contract's execution, that he was not in earnest about selling the farm. Therefore, the court