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What is a Meeting of the Minds?

What is a Meeting of the Minds? 

Making contracts sounds deceptively simple, two people just have to agree to do something and each receives some benefit regardless of how small. 

The ease of making a contract might make you think that there should be few disputes over what contracts need, but that is not the case. 

A contract only exists when the parties agree to all the important terms, or have a “meeting of the minds”. So, if one person understands the contract one way and the other thinks it means something else, there’s likely no contract. Sounds weird, right? But it happens. 

A client wanted to buy a charter airplane, he hired a company to do a “pre-purchase” inspection, the two businesses entered into a verbal agreement for the work. Based on the pre-purchase inspection report, the company bought the airplane. But when it tried to get charter certification, the FFA rejected the application and said the plane needed a bunch of very expensive repairs to qualify for the charter. 

The company then sued, said the other business was negligent in its pre-purchase inspection, even though a pre-purchase inspection had been performed and paid for, the court found that there was NO agreement, because the parties each meant something different by “pre-purchase” inspection. 

The company ended up getting the money it paid for the inspection back, but still owning a plane that needed very expensive repairs before it could be used as intended. 

Having a written contract that specifies what each party is supposed to do reduces the risk of litigation and of you not getting what you thought you agreed to. 

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