DB Orban Co. v. Lakco Pipe & Supply, Inc. - 496 So. 2d 1382 (La. Ct. App. 1986)

Rule:

Three circumstances must concur for the perfection of a contract of sale: the thing sold, the price, and the consent. La. Civ. Code Ann. art. 2439. In a sale, it is essential that the price be fixed and determined between the parties, otherwise no sale exists. La. Civ. Code Ann. art. 2464. A contract of sale requires that both parties intend the same thing.

Facts:

The parties entered into what they thought was an agreement, under which the pipe would be sold for $ 400 per net ton based on the actual weight of the pipe. The buyer, defendant Lakco Pipe & Supply, Inc., picked up 103 segments of pipe from the seller, plaintiff D B Orban Company, then resold or disposed of 30 of them. Two invoices for 28 segments were paid when the plaintiff found that it was being billed for the theoretical, rather than the actual, weight. Defendant informed plaintiff that if defendant was not billed as agreed upon, defendant wished to return any pipe in its possession and settle the account. Plaintiff eventually agreed to accept the pipe with freight pre-paid, plus a 15% restocking charge. Defendant would not agree to this or pay for the pipe, and plaintiff filed the present suit to collect on the unpaid purchase price for steel pipe alleged to have been sold to defendant. In its answer, defendant claimed that the parties failed to agree on a price for the pipe and thus no contract of sale was perfected. Defendant also reconvened seeking the return of money paid to plaintiff in error and also seeking storage, transportation, and handling costs. After trial on the merits, the district court rendered a judgment in favor of defendant on the principal demand, finding that the contract of sale was never perfected. Plaintiff was ordered to pick up the pipe remaining in defendant’s possession and credit defendant's account for it. Defendant's reconventional demand was dismissed. Plaintiff appealed and defendant answered the appeal.

Issue:

Was a contract of sale perfected between the plaintiff and the buyer? 

Answer:

No.

Conclusion:

The court noted that three circumstances must concur for the perfection of a contract of sale: the thing sold, the price, and the consent. In a sale, it was essential that the price be fixed and determined between the parties, otherwise no sale would exist. A contract of sale required that both parties intended the same thing. In this case, the evidence established that defendant intended to pay plaintiff $400 per net ton based on the actual weight of the pipe. On the other hand, plaintiff intended to require defendant to pay $400 per net ton based on the theoretical weight of the pipe with a credit to be issued later. The trial court found that plaintiff indicated that there was no agreement as to price by its failure to properly invoice defendant after defendant protested the amount billed. The record also reflected a disagreement between the parties concerning what quality pipe was intended to be sold and purchased. Considering all the circumstances, the Court found no clear error in the trial court's conclusion that there was no meeting of the minds and therefore no contract between the parties. Regarding the defendant’s reconventional demand, the court held that it was properly dismissed, as the costs for storage, handling, and transport could not be awarded under La. Civ. Code Ann. art. 2497 because there was no recission of a contract.