Lucy v. Zehmer

A. H. Zehmer (defendant) owned Ferguson Farm. For years, W. O. Lucy (plaintiff) expressed interest in buying the farm. On the evening of December 20, 1952, Zehmer wrote on a restaurant check, “We hereby agree to sell to W.O. Lucy the Ferguson Farm complete for $50,000.00, title satisfactory to buyer.” The agreement was signed by Zehmer and his wife (defendant). The next day, Lucy arranged for his brother (plaintiff) to pay half the purchase price in exchange for a half interest in the farm. Lucy then hired an attorney to examine title and, upon a satisfactory report, contacted Zehmer to close the transaction. Zehmer refused, claiming that he never really agreed to sell. The Lucys sued the Zehmers, seeking specific performance of the agreement. At trial, Lucy testified that (1) he and Zehmer discussed the transaction for 40 minutes before Zehmer executed the agreement; (2) although he and Zehmer both had a few drinks, neither was intoxicated; (3) the executed agreement was a second draft resulting from Lucy’s request that Zehmer add a title provision and change “I” to “We” because both Zehmer and his wife would need to sign; and (4) Zehmer refused Lucy’s offer of $5 to bind the deal as unnecessary because of the agreement. Zehmer testified that he had been drinking all afternoon before drinking with Lucy and was intoxicated. Zehmer also testified that (1) he did not believe Lucy had $50,000 and the agreement was merely a jest to call Lucy’s bluff; (2) when convincing his wife to sign, Zehmer told her, out of Lucy’s earshot, that the agreement was just a joke; and (3) when Lucy took the agreement off the table and offered to pay $5, Zehmer realized Lucy thought the transaction was serious and promptly told Lucy he wasn’t really selling. The trial court held that there was no binding agreement and denied specific performance. The Lucys appealed.