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Kentucky Court of Appeals - 51 S.W. 196, 106 Ky. 659
Tags: Contracts, Acceptance, Offer
tl;dr:
A glass manufacturer refused to fulfill an order for Mason jars. The manufacturer was held liable because the price quote they sent, inviting the buyer’s acceptance, was a binding offer to sell.Video Summary
Case Summary
Fairmount Glass Works v. Crunden-Martin Woodenware Co. (1899), involved a contract for the sale of ten carloads of Mason jars.
Crunden-Martin Woodenware Co. (plaintiff) sued Fairmount Glass Works (defendant) for a breach of their contract to sell 10 car loads of Mason jars.
Crunden-Martin wrote a letter to Fairmount Glass, requesting, “Please advise us the lowest price you can make us on our order for ten car loads of Mason green jars…” Fairmount Glass responded with a price quotation: “Pints $4.50, quarts $5.00, half gallons $6.50, per gross, for immediate acceptance, and shipped not later than May 15, 1895…” Crunden-Martin accepted the offer, but Fairmount Glass said they could not fulfill it because they were sold out.
Crunden-Martin brought suit, alleging that their acceptance had closed the contract and that Fairmount Glass was then obligated to sell. Fairmount Glass said that a price quote is not an offer to sell, so they could decline to fill the order. The trial court ruled for Crunden-Martin and Fairmount Glass appealed.
The main issue in the case was determining if the defendant's letter to the plaintiff was an offer or just a price quotation. The court decided that the letter was an offer since it showed a clear intention to sell and indicated the defendant's willingness to be bound by an acceptance. Furthermore, the letter contained a statement "for immediate acceptance," implying urgency and finality.
This case is important because it demonstrates the principle of offer and acceptance in contract law. It highlights that an offer must be definite and certain, and an acceptance must clearly and unconditionally agree to the offer's terms. The case also shows that courts will interpret communication between parties based on their objective meaning and intention, along with surrounding circumstances and customs. Lastly, the case distinguishes between offers and price quotations—preliminary communications that do not create legal obligations.
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The case involves a dispute between Crunden-Martin Wooden Ware Co. and Fairmount Glass Works over the sale of Mason green jars. Crunden-Martin requested the lowest price for ten car loads of jars, and Fairmount responded with a quote that included an option for immediate acceptance or a cash discount. Crunden-Martin confirmed their acceptance of the offer through a telegram, but Fairmount later claimed that the transaction was not completed until the order was accepted. The court believes that Fairmount's response was a definite offer to sell on the terms indicated, which was closed by immediate acceptance. The court notes that the telegram of acceptance from Crunden-Martin refers to the specifications that were mailed to Fairmount, which confirmed the contract for ten cars of Mason green jars, complete with caps and rubbers, to be delivered to East St. Louis at specified prices and terms. The lower court ruled in favor of Crunden-Martin, but Fairmount has appealed. The court will consider the arguments in determining the validity of the contract.
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