Ragosta v. Wilder (1991)

Facts

–          Plaintiff, wanted to buy “fork shop” since 1985 – became available in 1987 again.

• Upon notice of this, Ragosta (P) mailed a $2,000 check wanting the property for $88,000.

–          Dated September 28^th, 1987- Wilder sent $2,000 back – explicitly saying he didn’t want the money cause he didn’t want to be “tied up” – selling two properties at once. Keep the one that was not sold.

• Wilder – returned letter saying he will not sign acceptance offer.
  • Up until November 1^st, will sell for $88,000.
    • *providing property not sold*

–          Phone call – plaintiff assured that  no one else was interested in property – plaintiff prepared to accept the offer.

–          October 8^th  – defendant called, 2 days before selling date, that he would not sell.

–          Plaintiffs argument

• Wanted $7,500 for closing costs – specific performance.
• Relied on D notice and assurance of sale going thru – D knew of costs incurred upon them.
• Actions to obtain financing could be act of consideration – detrimental.

Procedural History

–          Trial court favored Ragosta.

–          Supreme Court of Vermont reversed and remanded for judgment – Wilder.

–          Trial Courts ruling

• Wilder (D) – made an offer that could only be accepted by performance prior to deadline. Already begun performance
• D can’t back out of offer based upon primary estoppel.

Issue

–          Was there a performance on the behalf of the plaintiff that would create an option contract binding? Did it suffice an equitable estoppel? Did it have consideration?

Holding

–          No

Rule

–          An offer must be accepted for it to be binding – some form of consideration must be present.

Reasoning

–          Supreme Court

• D received no consideration for either promise
• Returned $2,000 which would have been consideration cause he wanted to keep it open.
• Not enforceable – lacked equitable estoppel – D could revoke offer to sell.
  • There were no facts known to the defendant but unknown to plaintiffs.
  • Plaintiffs sought financing before offer to sell was legit.
  • Restatement 87- what is tendered must be part of the performance ($88,000).
  • P was engaged in preparation for performance.

–          *** Plaintiff was not 100% certain that defendant would sell property because of the “if not sold to someone else clause”***

Notes

–          Equitable estoppel

1. Party must know the facts.
2. Party being estopped must intend that his conduct be acted upon.
3. Must ignorant of the true facts.
4. The party asserting the estoppel must rely on the conduct of the party to be estopped to his detriment.

–          Why is fair that the Plaintiffs could back out, but defendant could not?