But We Agreed, Didn’t We?

September 4, 2016

But We Agreed, Didn’t We?

Contract law abounds with disputes over whether a binding contract has been created at a point in time, and many cases have been heard in which one side to the dispute alleges that a contract has been made whilst the other claims that an 'agreement to agree' only exists, which is not legally binding.

In an interesting case on this issue, the Court of Appeal decided that a contract existed between two parties despite the fact that neither the final price nor the delivery date for the goods had been agreed.

The circumstances were unusual and related to an agreement to supply a Porsche limited edition car. The customer placed an order and paid a deposit to the car dealer in order to be first on the list when the car was delivered. However, the dealer supplied it instead to another customer. The customer who had paid the deposit sued the dealer for the difference between the list price of the car (which was not known at the time the order was placed) and its market value (which was higher).

The customer won, the Court concluding that the lack of certainty in the contractual terms was not sufficient to prevent the contract from being binding.