Contracts I

Gray v. Toledo, S. L. & W. R. Co.

Court of Appeals of Missouri, Kansas City, 1910

Facts:

Stephens worked as a brakemen on defendant's railroad and was killed on the job. Plaintiff was appointed as the administrator of Stephens' estate. Plaintiff sought to recover damages for Stephens' death, and filed an action to do so. While this action was pending, plaintiff and defendant negotiated, mainly via letters and telegrams. Eventually, defendant said they could not go higher than $1,500. Six days later, plaintiff told defendant that this offer was accepted and dismissed his suit. Defendant replied that witnesses had arrived and that they were no longer open to settlement. Plaintiff then refiled this suit personally, not as administrator of Stephens' estate, to recover the amount.

Procedural History:

Trial court found for plaintiff.

Issue:

Did defendant's reply constitute a contractual offer?

Rule:

Pages 8–9

An offer must be sufficiently definite and certain to show an intention to create legal relations and to assume a legal liability for the sum said to be offered, on its acceptance by the party to whom it is made.

Reasoning:

Merely stating a highest price that one can offer does not imply a contract to pay that price.

Holding:

No, defendant's reply did not constitute a contractual offer. Reversed.


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