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While a contract may be either expressed or implied, or written or oral, it must result from a meeting of the minds of the parties in mutual assent to the terms, must be based upon sufficient consideration, free from fraud or undue influence, not against public policy, and sufficiently definite to be enforced.
This lawsuit involved an action in contract, brought by six former employees of Nuclear Fuel Services Company (NFS) against their union, the Oil, Chemical and Atomic Workers International Union, Local # 3-677 (the OCAW). The discharged workers alleged in their complaint that, based on an agreement with the OCAW, they were entitled to receive weekly compensation from the union in an amount equal to their lost wages, plus insurance coverage for themselves and their families, "until [they] were allowed or could return to work" at NSF. They further alleged that the union had breached this contract by discontinuing weekly payments while they were still unemployed. The OCAW denied that there was ever an enforceable contract between the union and the discharged workers, although the union concededly had made weekly payments to the plaintiffs for some 22 months, in an amount totalling over $ 300,000. The disputed question, therefore, is whether and under what circumstances the OCAW was entitled to terminate these payments. The chancellor held that there was a valid contract between the parties. The chancellor also found that the union had breached the contract and ordered the union to resume payments to the discharged workers under terms outlined below. On appeal from the trial court, the Court of Appeals likewise concluded that there was an enforceable contract, but it expanded the terms of the judgment against the union.
The OCAW now appealed the decision of the Court of Appeals, contending among other things that there was no valid contract because there was no mutual assent between the parties.
Was OCAW entitled to terminate the weekly payments to the employees?
The court held that the lower court erred in rewriting a vague and indefinite agreement because the negotiators could not bind the union to an agreement, the only mutuality of agreement the union had was to "take care of" the discharged employees. The agreement was indefinite and unenforceable because it lacked a specified duration of payment and although a reasonable duration may sometimes be interpreted, the lower court's imposition of a payment period extending until the last discharged employee reached age sixty-two was not reasonable under the circumstances.