Business Law Assignment 2: Analysis of Lucy v. Zehmer Case

This Business Law assignment analyzes the case of Lucy v. Zehmer, focusing on the requirements of a valid contract. It examines offer and acceptance, consideration, capacity, and legality, drawing from the court's reliance on the objective standard of intent. The assignment explains the significance of the memorandum and the Statute of Frauds, as well as the Uniform Commercial Code. The document provides a detailed analysis of the case, including the court's evaluation of Zehmer's mental state and the concept of consideration. It concludes that the intentions of parties should not be considered when there is sufficient written evidence. The solution includes references to relevant legal sources and case law.

Running head: BUSINESS LAW ASSIGNMENT
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Business Law Assignment
Name
Institution

BUSINESS LAW ASSIGNMENT 2
A contract is a legally binding agreement that is enforceable by law. The law of contract
ensures that these agreements are made in a fair manner and they can be enforced when one
party breaches an agreement. The requirements of a valid contract are; offer and acceptance,
consideration, capacity and legality.
An offer can be described as a proposal and acceptance can be described as acceptance of the
proposal. From the case, Lucy –vs- Zehmer (1954):
The court in determining whether an offer had been made and accepted, relied on the fact that
indeed the plaintiff had the memorandum written twice and signed by Mrs. Zehmer, the parties
provided for the examination of the title , the parties discussed what was to be included in the
sale and they both wrote and signed the contract .The actions and words of the parties in this
case were more important than the intention in the mind of the defendant which was not made
known to the plaintiff during the making of the contract. The parties acted in a manner that
indicated that an offer was made by the defendant and was accepted by the plaintiff. .
The court in evaluating Zehmers’ mental state and behavior in determining whether there was
an offer, relied on the objective standard of intent which is also known as “the meeting of the
minds.” This standard requires all parties to mutually assent to a contract, which must be
declared and demonstrated in an objective manner. This standard is based on the words used,
acts of the parties and the circumstances in which the contract is made. This was reflected in the
courts’ opinion by stating, “In the field of contracts, as generally elsewhere, "We must look to the
outward expression of a person as manifesting his intention rather than to his secret and
unexpressed intention. The law imputes to a person an intention corresponding to the reasonable
meaning of his words and acts....’” (First Nat. Bank v. Roanoke Oil Co., 169).

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At no time prior to the execution of the contract had Zehmer indicated to Lucy by word or act
that he was not in earnest about selling the farm. The court in determining whether the defendant
was too intoxicated and therefore lacking the capacity to get into a contract, was of the opinion,
“It is contradicted by other evidence as to the condition of both parties, and rendered of no
weight by the testimony of his wife that when Lucy left the restaurant she suggested that Zehmer
drive him home. The record is convincing that Zehmer was not intoxicated to the extent of being
unable to comprehend the nature and consequences of the instrument he executed, and hence
that instrument is not to be invalidated on that ground.” (17 C.J.S., Contracts, section 133).
Consideration is defined by Pallocks in Dunlop –vs- Selfridge (1915),”as an act or
forbearance of one party, or the promise thereof, is the price for which the promise of the other
is bought.” In the case of Lucy –vs- Zehmer, after the plaintiff and the defendant got into
negotiations, the defendant wrote on the back of a pad "I agree to sell the Ferguson Place to W.
O. Lucy for $50,000.00 cash." The fact that the plaintiff agreed to give up $50,000; it became a
legal value because in return, the defendant promised to sell the said land to him. Under the law
of contract, a promise can be enforced against a party if one of the parties has given up
something of legal value (Miller, 2016).
According to the Uniform Commercial Code(1952) which is amongst the statutes of Frauds
provides that ,all sale of goods contracts worth more than $ 500 in the United States of America
cannot be enforced without written evidence to show that the contract was made. From the case,
the amount in question is $50,000 and therefore the plaintiff could not enforce the sale of land
without the memorandum.
It was paramount for Zehmer to draft and sign the Memorandum because, Statute of Frauds
requires that the Memorandum be in writing in order for it to be sufficient evidence that the

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contract was made. The Uniform Commercial Code requires that the Memorandum be signed by
the party to be charged and it is not necessary for all the parties to the contract to sign the
memorandum (Miller, 2016).
In conclusion, the intentions of parties should not be considered in contracts when there is
sufficient evidence in writing, since the court cannot be able to ascertain the thoughts of an
individual when making the contract.

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REFERENCES
Miller, R.L (2016), Business Law: Text &Cases-The first Course. Boston, MA: Cengage
Learning.
First Nat. Bank v. Roanoke Oil Co., 169 Va. 99, 114, 192 S.E. 764, 770
17 C.J.S., Contracts, section 133 b., p. 483
Taliaferro v. Emery, 124 Va. 674, 98 S.E. 627.
Legal Dictionary, Retrieved from https://legal-dictionary-thefreedictionary.com.
Bowerman and Another- vs – Association of British Travel Agents (CA 21 Nov 1991)
Mer Dunlop –vs- Selfridge (1915)
Meram –vs- MackDonald. (2006 U.S Dist. LEXIS 79069 (U.S Dist. C.T S.D. Cal,).