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Davis v. Satrom | 383 N.W.2d 831 (1986)

Offer and acceptance are the building blocks of contracts. But when negotiations are conducted and counteroffers are made, it can be unclear whether an offer has been accepted and a contract has been formed. In Davis versus Satrom, we explore the common-law rules for counteroffers.

Dwight Davis negotiated to purchase a mobile home park from Gayle Satrom and D C Blair, collectively, the sellers. Davis sent a letter of intent to the sellers, which set out various terms and conditions. The sellers altered some of the letter’s terms and returned it to Davis. After further negotiations, Davis sent a purchase agreement containing new terms. The sellers signed the agreement but wrote in several additional conditions, including one that made the agreement subject to the approval of the sellers’ attorney. The sellers’ attorney didn’t approve the agreement, and the sellers notified Davis that they wouldn’t be moving forward with the sale.

Davis sued the sellers. Davis argued that a contract had been formed and asked the court to order specific performance. The sellers moved for summary judgment on the grounds that no contract had been formed. The trial court granted the sellers’ motion and dismissed the complaint. Davis appealed to the North Dakota Supreme Court.

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