Mutual Assent

AuthorFranklin G. Snyder, Mark Edwin Burge
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Unit 3
Part One
Mutual Assent
In a dispute alleging breach of contract, sometimes the parties do not agree
that there was any agreement at all. Such claims can arise from the fact that
language, while usually reliable, is not always a perfect means of communication.
Conduct intended to indicate one thing may be taken to indicate something very
different. People negotiating a transaction may come from different backgrounds,
possess different information, have different understandings, or use words in
different ways. Anyone who has ever been compelled in a discussion to exclaim, “But
that’s not what I meant!” can understand this problem.
Subjective or Objective Understanding? But the problem in using “agree” or
“consent” is that human beings in general (and judges and juries in particular) are
not good at reading minds. As in ordinary affairs, they usually try to determine what
someone intended by looking at what they said and did.
The earliest American
contract cases, for example, seemed completely uninterested in what parties
themselves thought about the transaction. In cases like Murray v. Bethune, 1 Wend.
191 (N.Y. 1828), courts held that a party’s subjective understanding of the deal was
actually irrelevant to the question whether he had reached an agreement. Indeed, a
party was not even permitted to testify at trial as to what he understood a contract
to mean. “The mere understanding of one of the parties to the agreement,” said the
Murray court, “without such understanding having been communicated or assented
to by the other party, could not be given in evidence in order to make out the contract
or agreement between them.”
Continental European Influence. This refusal to consider what the parties
actually thought might seem harsh. If contracts are to be voluntary obligations,
shouldn’t it be relevant that a party really did not understand that had agreed to a
[Consider an extreme case in a criminal law setting. If A shoots B six times in the back with
a revolver, yelling “Good riddance, sucker!”—and then reloads before firing six more shots at B, we
can infer that A intended to kill B. We would not need any extra evidence of his actual mental thoughts
in order to reach our conclusion.Eds.]
particular obligation? In Europe, influenced particularly by French jurisprudence,
the answer began to be (at least sometimes) “yes.” And just as French philosophy had
influenced America’s founding generation, French legal thinkers—particularly
Robert Joseph Pothier
began to influence American law with what came to be
called the “will” theory of contract. The will theory (the term itself is a later invention,
but it is accurate enough) held that obligations had to be knowingly and voluntarily
assumed before they were binding. Some early signs of this appear when some
American courts, such as the New York judges in Mactier’s Administrators v. Frith,
6 Wend. 103 (N.Y. 1830), introduce the idea of a necessary “meeting of the minds” of
the two parties.
British Influence. American developments were pushed farther
down this road by changes brewing on the other side of the Atlantic. In the 19th
century, Great Britain was the world’s greatest commercial empire, and London was
the legal center of the commercial world. Notwithstanding the American Revolution
and independence of the United States, British cases remained highly influential in
American courts for well over a century due to the two countries’ shared common-law
heritage. Toward the end of the American Civil War, the British Court of Exchequer
announced its decision in a case called Raffles v. Wichelhaus, 159 Eng. Rep. 375
(Exch. 1864), which had enormous impact on both sides of the Atlantic.
In Raffles, a cotton buyer in England contracted with a seller in India to
purchase a load of cotton. The contract provided that the cotton would shipped “ex
Peerless”—that is, in the terminology of the day, aboard a ship called the Peerless. In
one of the strangest coincidences in legal historymost likely unknown to the parties
at a time before telegraph communication was availableit turned out that there
were two ships called Peerless in India, both of which were going to be carrying cotton
to England, one sailing from India in October and one sailing in December. When the
December Peerless arrived, the seller tried to deliver the cotton it carried to the buyer,
but the buyer refused to take it, claiming he had meant the cotton on the October
Peerless. Since the buyer had never communicated to the seller which Peerless he
meant, a rule like the one in Murray v. Bethune presumably would have made the
buyer’s testimony irrelevant. But the British court held otherwise. Where the parties
had differing interpretations of such an important matter, decided the court, and
neither knew of the other’s interpretation, there was simply no contract. The buyer
was not liable to take the goods. The Peerless case was cited with approval by many
treatise writers in Britain and the United States, and it began to make its way into
American law.
[Pothier, of whom you may never have heard, is one of 23 great legal thinke rs (from Moses
and Hammurabi to Thomas Jefferson and George Masonwhose marble portraits line the chamber of
the U.S. House of Representatives. Eds.]

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