75 N.Y.2d 1031 (1990)
A binding contract requires an objective manifestation of intent by all parties to enter into the agreement.
Summary
Scheck, the plaintiff, sued Burger King for specific performance of a real estate contract. The defendant, Burger King, argued that no binding agreement existed. The trial court dismissed the complaint, and the Appellate Division affirmed. The New York Court of Appeals affirmed, holding that no objective manifestation of intent to enter into a contract existed because Burger King’s president signed the contract with the understanding that it wouldn’t be delivered until further review, and the plaintiff was informed of issues with the contract’s approval.
Facts
Plaintiff and defendant, both not-for-profit corporations, engaged in negotiations for the sale of property owned by the defendant to the plaintiff, who was the lessee. After extensive negotiations, a final draft of the contract was presented to the defendant’s president, Yochman, just before a special membership meeting. The plaintiff had already signed the contract. Defendant’s attorney asked Yochman to sign before the meeting but assured him the contract would not be delivered until further review. Yochman signed, and the plaintiff’s attorney was informed of the signing but also warned of “trouble” and “bad news” regarding the contract’s approval.
Procedural History
The plaintiff sued for specific performance after the defendant failed to return the signed contract and stated that no binding agreement had been reached. The trial court dismissed the complaint. The Appellate Division affirmed the dismissal, and the plaintiff appealed to the New York Court of Appeals.
Issue(s)
Whether the circumstances surrounding the signing of the contract demonstrated the requisite objective manifestation of intent by both parties to enter into a binding contract for the sale of real property.
Holding
No, because the circumstances surrounding the signing of the contract did not demonstrate the requisite objective manifestation of intent by both parties to enter into a binding contract.
Court’s Reasoning
The Court of Appeals affirmed the dismissal of the complaint, emphasizing that a contract requires an objective manifestation of intent to be bound. The court relied on the principle articulated in Brown Bros. Elec. Contrs. v Beam Constr. Corp., 41 NY2d 397, 399-400 and Arnold v Gramercy Co., 15 AD2d 762, affd 12 NY2d 687. The court highlighted several key facts: (1) the defendant’s president signed the contract with the understanding that it wouldn’t be delivered until further review; (2) the plaintiff’s attorney was informed contemporaneously about issues with the contract’s approval; and (3) strenuous objections were voiced at the membership meeting after the signing. Because the signed contract was never returned to the plaintiff’s attorney and the deposit was returned, no objective manifestation of intent to be bound existed. The court reasoned that these circumstances, taken together, indicated a lack of mutual assent to the contract’s terms. The court did not find any dissenting or concurring opinions in the provided text.