Texas Causes of Action & Affirmative Defenses

Texas Causes of Action & Affirmative Defenses

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Saturday, March 16, 2013

To be legally binding, agreement can't be wishy-washy about what is agreed

Agreement to agree (in the future) does not make for a judicially enforceable contract.


The elements of a valid and enforceable contract are: (1) an offer; (2) an acceptance in strict compliance with the terms of the offer; (3) a meeting of the minds; (4) each party's consent to the terms; and (5) execution and delivery of the contract with the intent that it be mutual and binding. Hubbard v. Shankle, 138 S.W.3d 474, 481 (Tex. App.-Fort Worth 2004, pet. denied).
The necessary elements of both written and oral contracts are the same and must be present for a contract to be binding. Id. A contract's material terms must be sufficiently definite and reasonably certain to both parties. Fort Worth Indep. Sch. Dist. v. City of Fort Worth, 22 S.W.3d 831, 846 (Tex. 2000).
Accordingly, all essential terms of the agreement must be agreed upon before a contract may be enforced by the courts. T.O. Stanley Boot Co., Inc. v. Bank of El Paso, 847 S.W.2d 218, 221 (Tex. 1992). If the terms of an alleged contract are so indefinite that it is impossible for the courts to determine the rights and obligations of the parties, it is not an enforceable agreement. Shin-Con Dev. Corp. v. I.P. Invs., Ltd., 270 S.W.3d 759, 765 (Tex. App.-Dallas 2008, pet. denied). Parties may agree on some terms sufficient to create a contract, leaving other provisions for later negotiation. See Scott v. Ingle Bros. Pac., Inc., 489 S.W.2d 554, 555 (Tex. 1972); Ski River Dev., Inc. v. McCalla, 167 S.W.3d 121, 133 (Tex. App.-Waco 2005, pet. denied). When an agreement leaves material terms open for future adjustment and agreement that never occur, it is not binding upon the parties and merely constitutes an agreement to agree. See Fort Worth Indep. Sch. Dist., 22 S.W.3d at 846; Ski River, 167 S.W.3d at 134.

SOURCE: DALLAS COURT OF APPEALS - No. 05-12-00653-CV – 2/21/2013