Konic International Corp. v. Spokane Computer Services, Inc. - Case Brief
Konic International Corp. v. Spokane Computer Services, Inc., 109 Idaho 527, 708 P.2d 932 (1985).
Facts: An employee of Spokane Computer Services (D) issued a purchase order for a surge protector from Konic International Corporation (P). The employee believed that the price of “fifty-six twenty” meant $56.20 but the price was in fact $5,620. Spokane refused to accept the surge protector and Konic brought suit. The magistrate court found in favor of D on the grounds that D’s employee was not an agent with the authority to enter into the contract on D’s behalf. P appealed.
Issue: Is a contract enforceable if both parties attach materially different meanings to a term in the contract, and neither knows or has reason to know of the meaning attached by the other?
Holding and Rule: No. Restatement (2d) of Contracts 20: (1) There is no manifestation of mutual assent to an exchange if the parties attach materially different meanings to their manifestations and (a) neither knows or has reason to know the meaning attached by the other.
The court cited the rule in Raffles v. Wichelhaus, which has been codified as Restatement (2d) of Contracts 20. The court found that both parties attributed different meanings to the term “fifty-six twenty”. Price is a material term and where there is a one hundred fold difference in price, and neither party knew or had reason to know of the meaning attached by the other, there has been no meeting of the minds and therefore no contract. The court did not address the issue of the agency of D’s employee.
Disposition: Affirmed. Costs and attorneys’ fees to D.
Tags: agency, attorneys fees, case briefs, Contracts, law, lawnix, meeting of the minds, mutual mistake, mutuality
