Smith v. Gowdy
90 Mass. 566 · Massachusetts Supreme Judicial Court · 1864
Facts
The plaintiffs sent a letter to the defendants inquiring about the quantity and price of rags they had on hand. The defendants responded, stating the quantity and price of their rags. Subsequently, the plaintiffs sent a third letter indicating their intent to purchase the rags at the price previously named by the defendants. However, the defendants never accepted this offer in writing. No part of the rags was accepted or received by the plaintiffs, nor was any earnest money or part payment given.
Issue
Did the exchange of letters between the parties constitute a completed and binding contract for the sale of rags, particularly in light of the Statute of Frauds?
Holding
No, a completed contract was not formed between the parties because the defendants never accepted the plaintiffs' offer, and any oral acceptance would have been invalid under the Statute of Frauds.
Rule
A contract requires mutual assent, meaning a clear offer by one party and an acceptance by the other. Initial inquiries and statements of price do not constitute an offer or acceptance. For contracts involving the sale of goods, the Statute of Frauds requires a written acceptance or partial performance, such as the acceptance and receipt of goods, earnest money, or part payment, to be binding.
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