Sedmak v. Charlie's Chevrolet, Inc.

Missouri Court of Appeals · Contracts

Contractsoral contractstatute of fraudsU.C.C. 2-201(3)(c)part paymentsingle indivisible commercial unitquantity undisputedmanufacturer's suggested retail price

Facts

The Sedmaks sought to buy a limited-edition Corvette Pace Car from Charlie’s Chevrolet and, after discussions with sales manager Tom Kells, Mrs. Sedmak paid a $500 deposit and specified certain options for the car. Kells told her the price would be the manufacturer’s retail price, approximately $15,000, and Charlie’s later obtained the car with the requested options. When the car arrived, Kells informed the Sedmaks they could not buy it at that price and instead would have to bid on it. The Sedmaks sued for specific performance, and the trial court credited their version of events over Kells’s conflicting testimony.

Issue

Whether substantial evidence supported the finding of an oral contract at the manufacturer’s suggested retail price, whether that oral contract was enforceable notwithstanding the Statute of Frauds because of the Sedmaks’ part payment, and whether specific performance was a proper remedy for Charlie’s refusal to sell the limited-edition car.

Rule

A sales contract is sufficiently definite as to price if the parties agree to a method by which the price will be determined and the price can be ascertained at the time of performance; use of the manufacturer's suggested retail price satisfies that requirement. Under § 400.2-201(3)(c), where there is no dispute as to quantity, part payment for a single indivisible commercial unit validates an oral contract. Specific performance may be ordered under § 400.2-716(1) where goods are unique or in other proper circumstances, including when substitute goods cannot be obtained without considerable expense, delay, trouble, or inconvenience.

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One of 10 multiple-choice questions for this case. Pick an answer to see why.

In Columbus, Ohio, Nina Patel orally agreed to buy a dealer-allotted commemorative motorcycle from Riverbend Motors, a fictional dealership. The sales manager told her the price would be the manufacturer's suggested retail price in effect when the bike arrived, and Nina paid a $1,000 deposit that Riverbend accepted.

If Riverbend later refuses to sell unless Nina pays a much higher market price, which is the strongest argument that an enforceable contract existed despite the absence of a fixed dollar amount at formation?

Explanation. The majority held that a sales contract is sufficiently definite as to price when the parties agree on a method by which the price will be determined and the price can be ascertained at performance. A reference to the manufacturer's suggested retail price satisfies that requirement even if the exact figure is unknown at formation.