DAVID BALTER, APPELLANT,
v.
PAN AMERICAN BANK OF HIALEAH, APPELLEE
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Balter sued Pan American Bank of Hialeah for breach of contract after the bank refused to provide a loan to his corporation. The trial court granted a directed verdict for the bank, finding no enforceable contract existed because the parties were merely in preliminary negotiations lacking essential contract terms.
The trial court properly granted a directed verdict because no enforceable contract was formed. The parties were engaged in preliminary negotiations only, and essential contract elements were absent, including no agreement on loan amount, interest rate, repayment terms, no signed documents, and no consideration from Balter for the bank's alleged promise.
[1] A directed verdict is proper when the essential elements of a binding contract are absent from the evidence presented.
[2] Preliminary negotiations do not constitute an enforceable contract.
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Join FLexlaw to unlock all legal intelligence“There was no understanding as to the exact amount of money, the interest rate or time and method of repayment; furthermore, nothing was ever signed and no documents were exchanged between the parties.”
Establishes the absence of essential contract terms necessary for contract formation
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Join FLexlaw to unlock all legal intelligenceBalter's corporation sought a loan from Pan American Bank under an approved plan of arrangement. The bank refused to proceed with the loan, and Balter…
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PER CURIAM.
This appeal arose out of a claim for breach of contract asserted by Mr. Balter, the appellant/plaintiff, against Pan American Bank of Hialeah regarding a loan of money to appellant’s corporation under an approved plan of arrangement.1 The bank had refused to go through with the loan and plaintiff sued. The cause2 proceeded to trial, and at the conclusion of the plaintiff’s case the bank moved for a directed verdict.
The trial court granted the motion and plaintiff appeals, contending that the trial court erred in directing a verdict for the-appellee/defendant and that the jury, if it had had an opportunity to evaluate the plaintiff’s evidence, would have returned a verdict for the plaintiff.
We find no merit in the arguments advanced by appellant, and agree with the trial court that there was no enforceable contract entered into, the parties were merely negotiating as to the terms to be yet reached. It is apparent that the essentials of a binding loan agreement were conspicuously absent. There was no understanding as to the exact amount of money, the interest rate or time and method of repayment; furthermore, nothing was ever signed and no documents were exchanged between the parties.
We affirm on the authority of Calosso v.
First National Bank of Pompano Beach, 143 So. 2d 343 (Fla.2d DCA 1962). Compare, Bluevack Inc. v. Walter E. Heller & Company of Florida, 331 So. 2d 359 (Fla.3d DCA 1976). The conversations between the parties constitute merely preliminary negotiations. See Bluevack, supra, and Goff v. Indian Lake Estates, Inc., 178 So. 2d 910 (Fla.2d DCA 1965).
Further support for the affirmance of the trial court’s order is found in the record which shows that there was no consideration by Mr. Balter for the bank’s alleged promise to lend money. As so aptly stated by the appellee, where there is no mutuality of obligation, the necessary element of consideration is lacking and the “contract” is void. No purported agreement can be valid which binds one party but not the other; in such a case there is a fatal lack of mutuality. or reciprocity required to make an agreement binding on any party. Such mutuality of obligation is essential to the formation of a bilateral contract such as appellant contends was formed between the parties. See Ivey Plants, Inc. v. FMC Corporation, 282 So. 2d 205 (Fla. 4th DCA 1973); 17 Am.Jur.2d Contracts § 11; 11 Fla.Jur.2d Contracts § 56; 7 Fla.Jur. Contracts § 9.
Accordingly, the judgment appealed is affirmed.
. It seems that three months prior to the time that negotiations were going on between Mr. Baiter and the bank regarding the loan, appellant had filed a Chapter XI Petition in Bankruptcy.
. Actually there are multiple defendants, but the count relating to the alleged breach of contract to loan money was against the bank, only.
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Cited By (12 total)
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de Vaux v. Westwood Baptist Church, 953 So. 2d 677 (Fla. 1st DCA 2007)…01 So. 2d 305, 306 (Fla. 1st DCA 2005); Allen v. Berry, 765 So. 2d 121 (Fla. 5th DCA 2000); Drost v. Hill, 639 So. 2d 105 (Fla. 3d DCA 1994); 777 Flagler Co. v. Amerifirst Bank, 559 So. 2d 1210 (Fla. 4th DCA 1990); Balter v. Pan Am. Bank of Hialeah, 383 So. 2d 256 (Fla. 3d DCA 1980); Brown v. Dobry, 311 So. 2d 159 (Fla. 2d DCA 1975). “In order for a contract to be subject to specific performance, it must appear from the writing constituting the contract that the obligations of the parties with respect to [the…
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Ethyl Corp. v. Balter, 386 So. 2d 1220 (Fla. 3d DCA 1980)…n return for the release of his personal guarantee, and was not made a party to this action. . This occurred because, at the last minute, the Pan American Bank of Hialeah refused to lend Balter the money. See Balter v. Pan American Bank of Hialeah, 383 So. 2d 256 (Fla. 3d DCA 1980). Balter claimed that this action resulted in part from the failure of his attorney, Robert Frank, timely to supply the documents demanded by the bank as preconditions to the loan. See Balter v. Frank, 386 So. 2d 1227 (Fla. 3d DCA…1 / 2
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Hazen v. Allstate Ins. Co., 952 So. 2d 531 (Fla. 2d DCA 2007)…the principle of mutuality of obligation, an agreement that is unenforceable against the insurer cannot be enforced by the insurer. “[M]utuality of obligation is essential to the formation of a bilateral contract.” Balter v. Pan Am. Bank of Hialeah, 383 So. 2d 256, 257 (Fla. 3d DCA 1980). “It is basic hornbook law that a contract which is not mutually enforceable is an illusory contract.” Pan-Am Tobacco Corp. v. Dep’t of Corr., 471 So. 2d 4, 5 (Fla.1984). Under such an “illusory contract,” “neither side may b…
Previewing 3 of 12 citing cases — full citator treatment, depth of discussion, and citing context are member features.
Join FLexlaw to unlock all legal intelligenceAuthorities Cited
- Ivey Plants, Inc. v. FMC Corp., 282 So. 2d 205 (Fla. 4th DCA 1973)
- Goff v. Indian Lake Ests., Inc., 178 So. 2d 910 (Fla. 2d DCA 1965)
- Bluevack, Inc. v. Walter E. Heller & Co. OF Fla., 331 So. 2d 359 (Fla. 3d DCA 1976)
- Calosso v. First Nat'l Bank OF Pompano Beach, 143 So. 2d 343 (Fla. 2d DCA 1962)