Opinion ID: 492351
Heading Depth: 1
Heading Rank: 3

Heading: Are The Terms Of The Contract Too Vague or Speculative?

Text: 23 Defendants' second argument assumes that the jury believed Mayo's testimony and found that defendants were contractually obligated to pay Mayo $20,000 per megawatt of potential installed capacity for each recommended dam site that was acquirable within three years. Such a contract, argue defendants, would be too vague or speculative to warrant enforcement by a court of law. Defendants specifically complain that the alleged contract (1) does not sufficiently describe Mayo's contractual obligations; (2) does not provide a definitive means by which to ascertain whether a given site was acquirable; and (3) does not specify who was to pay the $20,000 per megawatt commission to Mayo. We are unpersuaded that any of these alleged defects precludes enforcement of the oral contract described by Mayo. While it is true that contracts, both oral and written, must be definite in order to be enforceable, the standard of definiteness is one of reasonable certainty and not 'pristine preciseness.'  Sawin v. Carr, 114 N.H. 462, 465, 323 A.2d 924, 926 (1974). 24 First, we believe there was ample evidence concerning Mayo's performance obligations under the contract. Mayo testified that his job was to serve Ryan and Schooner as a consulting engineer for an initial period of three months and, within that period, he was to get a quick fix on the largest possible number of sites that could be put into negotiation for acquisition. (App.204). Time was of the essence because, as Mayo explained, the idea was to put numerous sites on line and generate income as quickly as possible (App.205), and his job was to provide Ryan, a venture capitalist, with valuable technical information that was essential to Ryan's investment decisions. Defendants are correct that there was little testimony regarding negotiations or agreements between Ryan and Mayo regarding Mayo's specific job duties. Ryan testified, however, that Mayo was to analyze New England hydro sites for three months (App.264) and the record is rich with description of the tasks Mayo performed, apparently with Ryan's approval, in this regard. For instance, the record contains no less than twenty pages of testimony by Mayo setting forth the process he used to analyze and evaluate hydroelectric sites. (App.192-204). Mayo also testified that, pursuant to his contract with Ryan and Schooner, he carried out site evaluations on numerous potential sites during his three month consultancy and prepared written reports for Ryan on approximately 20 desirable sites. (App.208-09). Taken in the light most favorable to plaintiff, we believe that this undisputed evidence, along with the inferences that can reasonably be drawn from it, sufficiently describe Mayo's duties under the alleged oral contract. 25 Second, we find no merit in defendants' contention that the term acquirable was too vaguely defined to permit enforcement of the bargain. Mayo specifically testified that the term referred to all hydroelectric sites which, with a diligent effort[,] ... could have been acquired by the newly formed corporation within three years. (App.213). We believe that, despite the term's inherent imprecision, it is not so ambiguous as to fall afoul of the reasonable certainty standard and cause the contract itself to be unenforceable. True, there was a factual dispute at trial as to which hydroelectric sites identified by Mayo could have been acquired in the exercise of reasonable diligence, but this issue was properly left to the jury. The jury heard evidence regarding the methods of evaluating the capacity and value of hydroelectric sites, the various means of acquiring the rights to such sites, and the need to obtain regulatory approval before operating a site. Having reviewed this evidence, it rejected Mayo's proposed list of 21 sites and found instead that the only acquirable sites were the three actually acquired by Continental and its affiliates during the three year period. The factual dispute, therefore, concerned only which sites satisfied the standard set by contractual term. Such a dispute does not render the oral contract unenforceable on vagueness grounds where, as here, the meaning of a term itself is reasonably certain. Sawin, 114 N.H. at 465, 323 A.2d at 926. 26 Finally, we are not persuaded by defendants' assertion that the failure to specify precisely which party was to pay the commission renders the contract too vague or speculative to be enforced. Mayo first testified that Ryan, acting on behalf of Schooner, said, what I'll do is I will pay you $20,000 a megawatt of ... the potential installed capacity of the sites. (App.188). Then, according to Mayo, Ryan went on to say that Continental Hydro, the new company that is to be formed, will pay that $20,000 a megawatt. (App.188). We admit that Mayo's testimony leaves some confusion as to which party was actually supposed to pay the commission, but given the posture of this appeal we must view the evidence in the light most favorable to Mayo. Mayo did testify regarding his understanding that Ryan entered the contract on behalf of himself, Schooner, and the as yet unformed corporation (Continental) which Schooner sought to fund. (App.222). It is also significant that, at the time the parties entered the oral contract, Continental existed only in the sense that Ryan hoped to form such a corporation in the future to exploit the opportunities identified by Mayo. We are of the opinion, therefore, that the jury could have reasonably believed that the contract called for Ryan and Schooner, not Continental, to be ultimately responsible for paying Mayo's commission. Thus, we hold that the contract is not so vague in this regard as to be unenforceable against the two parties--Ryan and Schooner--who originally made the promise to Mayo. 27