Davis v Jacoby
S. Ct. California, 1934
Author:- Sam Biers

Facts: Davis had established a long and close relationship with the Whiteheads.  First, Mrs. Whitehead became seriously ill, and then Mr. Whitehead.  While the Davis’ lived in Canada, the Whitehead offered to bequeath all that he and his wife possessed, if the Davis’ moved back, cared for Mrs. Whitehead, and their business dealings until the death of each.  The Davis’ sent written acceptance to Mr. Whitehead.  Prior to arrival Mr. Whitehead committed suicide.  The Davis’ performed their respective terms under the agreement.  After Mr. Whitehead’s passing, the Davis’ learned that the consideration was bequeathed to others, and not them.

Issue: Whether the agreement between the parties was a bilateral or unilateral contract?

Holding: Bilateral

Procedure: Trail Court found for DF/Respondents.  Reversed, specific performance granted to Davis’.

Rule:   An offer invites the formation of a bilateral K by an acceptance amounting in effect to a promise by the offeree to perform what the offer requests, rather than the formation of one or more unilateral K by actual performance on the part of the offeree.

Ct. Rationale: The offer was an offer for a bilateral contract.  Mr. Whitehead knew form his past relationship with Davis that if they promised to perform (taking care of Mrs Whitehead) they would perform.  Whitehead expressly indicated the nature of the acceptance desired by him, Davis’ promise that they would come to California and do the things requested by him.  The Davis’ immediately sent their promise back, and Mr. Whitehead received the same.  The Davis’ moved to California, and despite Mr. Whitehead’s suicide, they continued to perform by administering assistance to Mrs. Whitehead.

PL A: The letter was an offer to enter a bilateral K, dependent upon PL promise to perform as acceptance.

Def A: (Jacoby) The letter of April 12, was an offer to contract, but that offer could only be accepted by performance and not by a promise to perform.  The offer was revoked by the death of Mr. Whitehead before performance.

Non sequitor - (sek weter) It does not follow.

Bilateral K - an exchange of promises where each party is both a promisor and a promisee.

Unilateral K - a promise is exchanged for an act or forebearance of an act.