Brief - Izadi v. Machado Ford

Izadi v. Machado (Gus) Ford, Inc., 550 So. 2d 1135 (1989) Court: Florida District Court of Appeal State: Florida Year: 1989 Plaintiff: Izadi, Attempted purchaser of vehicle from advertisement Defendant: Machado (Gus) Ford, Inc., the seller Cause of Action: Breach of contract, fraud, and statutory violations involving misleading advertising. Relief Sought: Damages Basis for Dispute: Law Facts: Izadi attempted to purchase a vehicle on grounds of an advertisement placed by the defendant (seller). The attempt to purchase included cash for $3,595, plus a$500 factory rebate, and an unspecified trade-in that can be assumed to have the value of substantially less than $3,000. The contract was entered into because the proposal made was on the basis of Izadi’s belief that the add offered $3,000 as a “minimum trade-in allowance” for any vehicle, regardless of its actual value. Machado refused to recognize this interpretation of its advertisement and turned Izadi down. Machado relied on the small print under the $3,000 figure which indicated it applied only toward the purchase of “any New ’88 Eddie Bauer Aerostar or Turbo T-Bird in stock” – neither of which was mentioned in the remainder of the ad – and the statement in the individual vehicle portions that the offer was based on a trade-in that was “worth 3000” Disputed Facts: None Plaintiff’s Argument: An enforceable contract was entered into Defendant’s Argument: Despite the plain wording of the advertisement, it had no intention of making an offer, but merely sought to lure customers to the sales lot; it claims also that, because of the small print at the bottom of the contract, any promises by the purchase to exchange the vehicle for a later model were not binding. Procedural History: An appeal from the dismissal with prejudice of a three count complaint for damages arising out of an advertisement. Lower Court Disposition: Issue1: Did Machado breach a contract? Rules of Law Stated: NLRB v. Federbush Co. (persuasive) o “Words are not pebbles in alien juxtaposition; they have only a communal existence; and not only does the meaning of each interpenetrate the other, but all in their aggregate take their purport from the setting in which they are used…)” Transport Rental Systems, Inc. v. Hertz Corp., 129 So. 2d 454, 456 (Fla. 3d DCA 1961) o The real intention, as disclosed by a fair consideration of all parts of a contract, should control the meaning given to mere words or particular provisions when they have reference to the main purpose.” o “If a contract contains clauses which are apparently repugnant to each other, they must be given such an interpretation as will reconcile them.” Application: In this case, that would mean disregarding both the superfine print and apparent qualification as to the value of the trade-in, as contradictory to the far more prominent thrust of the advertisement to the effect that $3,000 will be allowed for any trade-in on any Ford. Conclusion: We therefore believe that the complaint appropriately alleges that, objectively considered, the advertisement indeed contained just the unqualified $3,000 offer which was accepted by the plaintiff. *Contrary to what is perhaps the usual rule (1 Williston Contracts Section 27 & 1 Corbin on Contracts Section 25: than an enforceable contract arises from an offer contained in an advertisement. If an offer were indeed conveyed by an objective reading of the ad, it does not matter that the car dealer may subjectively have not intended for its chosen language to constitute a binding offer. As Williston states: o The test of the true interpretation of an offer or acceptance is not what the party making it thought it meant or intended it to mean, but what a reasonable person in the position of the parties would have thought it meant. The carefully chosen language and arrangement of the advertisement itself that Machado – although it did not intend to adhere to the $3,000 trade-in representation – affirmatively, but wrongly sought to make the public believe that it would be honored; that, in other words, the offer was to be used as the “bait” to be followed by a “switch” to another deal when the acceptance of that offer was refused. Persuasive Authority: A binding offer may be implied from the very fact that deliberately misleading advertising intentionally leads the reader to the conclusion that one exists. (Corbin, Contracts Section 64). Issue2: Statutory Violation Rule: Statutory provision against misleading advertising Conclusion: Since we believe the advertisement was misleading. Court’s Holding(s): We hold that the trial judge erroneously held the contract and misleading advertisement counts insufficient, but correctly dismissed the claim for fraud. Court’s Disposition: Affirmed in part, reversed in part and remanded. Affirmed in part – holding that the dismissal of appellant’s claim for fraud was proper where no cognizable damages were alleged as a result of a tortious misrepresentation Reversed & remanded – holding the breach of contract and misleading advertising claims sufficient where appellee advertised a minimum trade-in allowance, but significantly limited this allowance in fine print. Court’s Analysis & Reasoning: A contract had been formed even though the dealership had an erroneous belief as to what the advertisement, as written, meant or what it would legally convey.