The mental assent of the parties is not requisite for the formation of a contract. If the words or other acts of one of the parties have but one reasonable meaning, his undisclosed intention is immaterial except when an unreasonable meaning which he attaches to his manifestations is known to the other party.
Defendant husband wrote and signed a contract to sell his farm to plaintiffs and persuaded defendant wife to sign by telling her the contract was a joke on plaintiffs. When plaintiffs attempted to finalize sale, defendants attempted to deny contract on the grounds that defendant husband was drunk when making the contract and the contract was a joke on plaintiffs. Plaintiffs sued for specific performance. The trial court found for defendants.
Was there a valid contract?
The Court held that the Defendants' true intent in agreeing to sell their farm was not determinative so long as their words and actions warranted a reasonable person's belief that a contract was intended. Under the objective theory of contracts, plaintiffs reasonably believed the sale contract was a serious business transaction. The evidence suggested defendant husband was not too drunk to know what he was doing.