Beard Implement Co. v Krusa

Nature of the Case

This lawsuit involved a dispute over a contract to purchase a combine.

Facts

Beard Implement Co. (P) met with Krusa (D) to discuss the purchase of a new combine. Krusa filled out a purchase order but none of Beard’s representatives signed the order. Krusa also gave Beard an undated counter check for $5,200 that was intended to represent the down payment on the purchase price of $52,800. Krusa claims that the check was undated because he planned to call Beard later to let him know if he wanted to proceed with the transaction. Krusa called back and told Beard that he did not want to proceed with the deal.

Krusa then met with a representative of Cox Implement Company and bought the same equipment for a lower price. Krusa sent a letter stating that he was not going to purchase the equipment from Beard. Beard met with Krusa and then sent Beard’s salesmen a $100 check for time expended on the unclosed sale. The purchase order had never been signed by Beard. The trial court found that a binding contract had formed and Krusa appealed.

Issue

Is a purchase order an enforceable contract even if it is not accepted by the offeree?

Holding and Rule of Law

No. A purchase order is not an enforceable contract until it is accepted by the offeree.

The purchase order that was signed by Krusa constituted an offer by Krusa to Beard. Acceptance of that offer is governed by UCC 2-206. The form, drafted by Krusa, called for acceptance by Beard’s signature. There was no ambiguity regarding this position such that Beard could consider the signed order and a check by Krusa a constituting a contract.

Disposition

Reversed and remanded.