A promisor may be bound to perform something which he did not intend to promise, or a promisee may not be entitled to require that performance which he understood to be promised to him. The meeting of minds essential to the formation of a contract is not determined by the secret intention of the parties but by their expressed intention, which may be wholly at variance with the former. The law imputes to a person an intention corresponding to the reasonable meaning of his words and acts. It judges his intention by his outward expressions and excludes all questions in regard to his unexpressed intention. If his words or acts, judged by a reasonable standard, manifest an intention to agree in regard to the matter in question, that agreement is established, and it is immaterial what may be the real but unexpressed state of his mind on the subject.
Appellant employee of respondent continued working for respondent after the expiration of his written contract of employment. Appellant alleged that when he asked respondent's president if his employment would continue for another year, he was told that he was all right and need not worry. Appellant understood this statement to be a renewal of his contract. When he was terminated, appellant sued for breach of contract. The trial court ruled for the employer. The appellate court reversed and remanded.
Did the employer's oral utterances amount to a re-employment contract?
The employer's words were sufficient to constitute the renewal of the employment contract.
If the conversation was according to appellant's version and he understood he was employed, it constituted in law a valid contract of reemployment, and the court erred in making the formation of a contract depend on a finding that both parties intended to make one. It was only necessary that appellant, as a reasonable man, had a right to and did so understand.