196 Va. 493, 84 S.E.2d 516
W. O. Lucy and J. C. Lucy, complainants, brought suit against A. H. Zehmer and Ida S. Zehmer, defendants, seeking specific performance of an alleged contract to sell the Ferguson farm.1 The farm is located in Dinwiddie County and contains 471.6 acres.2 A. H. Zehmer had owned the farm for more than ten years after purchasing it for $11,000.3
The writing in question was prepared by A. H. Zehmer on December 20, 1952.4 It read: “We hereby agree to sell to W. O. Lucy the Ferguson Farm complete for $50,000.00, title satisfactory to buyer,” and was signed by both Zehmers.5 On that night around eight o’clock, W. O. Lucy entered the Zehmers’ restaurant in McKenney after deciding to attempt another purchase of the farm.6 During a discussion lasting thirty or forty minutes, Lucy and Zehmer negotiated the terms.7 Zehmer initially drafted the agreement in the singular before revising it to include his wife at Lucy’s request.8
Both men consumed drinks from a bottle Lucy had brought.9 Lucy testified he was not intoxicated and believed Zehmer was not either.10 Lucy took possession of the signed writing and left the premises insisting that he had purchased the farm.11
The next day Lucy contacted his brother J. C. Lucy to arrange for a half interest in the purchase.12 On December 22 Lucy engaged an attorney to examine the title, which was reported satisfactory on December 31.13 Lucy wrote to Zehmer on January 2 stating that he was ready to pay the $50,000 in cash.14 Zehmer replied by letter mailed January 13 asserting that he had never agreed or intended to sell the farm.15
The Zehmers contended that the writing was prepared as a joke while both parties were drinking heavily.16 Zehmer claimed he was “high as a Georgia pine” and intended only to call Lucy’s bluff regarding his ability to pay $50,000 in cash.17 Mrs. Zehmer testified that her husband whispered to her that the matter was a joke before she signed.18 A waitress observed the parties laughing, joking, and drinking.19 Depositions were taken.20 The trial court entered a decree dismissing the bill on the ground that the complainants had failed to establish their right to specific performance.21 The Lucys appealed from that decree.22
Whether the writing signed by A. H. Zehmer and Ida S. Zehmer on December 20, 1952, constituted a binding contract for the sale of the Ferguson farm to W. O. Lucy?23
In the field of contracts, mutual assent is judged exclusively from the outward expressions of the parties rather than from any secret or unexpressed intention.24 The law imputes to a person an intention corresponding to the reasonable meaning of his words and acts.25 If the words or other acts of one party have but one reasonable meaning, his undisclosed intention is immaterial except when an unreasonable meaning which he attaches to his manifestations is known to the other party.26 A person cannot set up that he was merely jesting when his conduct and words would warrant a reasonable person in believing that he intended a real agreement.27 The elements are (1) words or acts that manifest an intention to agree when judged by a reasonable standard, (2) a good-faith acceptance by the other party, and (3) delivery or taking possession of a written instrument without contemporaneous indication that the matter is a joke.28
Yes. The facts establish that the writing was the product of a serious business transaction rather than a casual jest.29 W. O.
Lucy and A. H. Zehmer discussed the terms for thirty or forty minutes inside the restaurant.30 Zehmer first wrote an agreement in the singular, and Lucy objected because Mrs. Zehmer would have to sign.31
Zehmer then rewrote the instrument to read "We hereby agree to sell to W. O. Lucy the Ferguson Farm complete for $50,000.00, title satisfactory to buyer. " Both Zehmers signed the final version.32
Lucy took possession of the paper and left the premises insisting he had purchased the farm.33 The next day Lucy arranged with his brother J. C. Lucy to take a half interest and pay half the consideration.34
Two days later he engaged an attorney to examine title.35 These outward acts demonstrate that Lucy reasonably understood the transaction as binding.36 Although Zehmer later claimed he whispered to his wife that the matter was a joke, that intention was never communicated to Lucy.37 The reasonable meaning of the words and acts therefore controls, and the writing constituted a binding contract.38
The writing signed by A. H. Zehmer and Ida S. Zehmer on December 20, 1952, constituted a binding contract for the sale of the Ferguson farm to W. O. Lucy.39
Whether the complainants were entitled to specific performance of that writing?40
Specific performance is not a matter of absolute right but is addressed to the reasonable and sound discretion of the court.41 That discretion is not arbitrary or capricious; it is controlled by established doctrines and settled principles of equity.42 Where a contract is in its nature and circumstances unobjectionable, it is as much a matter of course for courts of equity to decree specific performance as it is for a court of law to give damages for breach.43 Grounds that ordinarily defeat specific performance include fraud, misrepresentation, sharp practice, dealing between unequal parties, or intoxication rendering a party unable to understand the nature and consequences of the instrument.44
Yes. The contract is unobjectionable in nature and circumstances.45 The parties had known each other for fifteen or twenty years.46 There was no fraud, no misrepresentation, and no sharp practice.47
Both men had been drinking, yet the evidence shows neither was intoxicated to the extent of being unable to comprehend the nature and consequences of the instrument.48 Defendants' counsel conceded at oral argument that Zehmer was not too drunk to make a valid contract.49 The purchase price of $50,000 was admitted by Zehmer to be a good price for land he had bought for $11,000.50 Lucy promptly arranged financing with his brother, obtained a favorable title opinion, and tendered performance in writing on January 2.51
None of the usual equitable defenses are present.52 The trial court's refusal of specific performance was therefore error.53
The complainants were entitled to specific performance of the writing.54