Opinion ID: 201025
Heading Depth: 2
Heading Rank: 1

Heading: Oral Contract and Contract Implied in Fact

Text: 16 It is a settled principle of contract law that a promise made with an understood intention that it is not to be legally binding, but only expressive of a present intention, is not a contract. R.I. Hosp. Trust Nat'l Bank v. Varadian, 419 Mass. 841, 647 N.E.2d 1174, 1179 (1995) (quoting Schwanbeck v. Federal Mogul Corp., 412 Mass. 703, 592 N.E.2d 1289, 1292 (1992) (internal citations and quotations omitted)). The comments that Boyle alludes to in support of the formation of an oral contract — comments by Navistar employees that he was or would be the dealer — pale next to the unequivocal and written communications from Navistar that Boyle had to complete a multi-part dealership application before Navistar would approve him and are also undermined by his own admissions during his deposition that, as far as he knew, none of the employees making the alleged statements had the authority to unilaterally grant the — as yet ungranted — dealership to him. 17 Boyle may have alleged a triable question of fact regarding Navistar's present intentions to offer him the dealership during the summer and fall of 2000, based on verbal communications, but such an intention — even if proven — does not suffice to establish that there was an oral contract. Id. Boyle's argument for oral contract formation also depends on a proposition that we cannot accept: that none of the terms of the dealership contract would require negotiation. See Rosenfield v. U.S. Trust Co., 290 Mass. 210, 195 N.E. 323, 325 (1935) (A failure of the parties to agree on material terms may not merely be evidence of the intent of the parties to be bound only in the future, but may prevent any rights or obligations from arising on either side for lack of a completed contract.) (citations omitted). Boyle undercuts this point by recognizing in his deposition that neither the performance requirements nor the geographic area of the dealership had been negotiated and set. Furthermore, the claim is inherently implausible, as manufacturers and dealers frequently adjust standardized contracts to suit their needs. See, e.g., Coady Corp. v. Toyota Motor Distrib., Inc., 361 F.3d 50, 61-62 (1st Cir.2004) (discussing that Toyota granted a car dealer with a six-year contract only a two-year contract extension and required a non-standard provision requiring [the dealer] to maintain 100 percent or better `retail sales efficiency'). 18 Boyle claims, though, that even without an oral contract, his dealings with Navistar produced a contract implied in fact. See LiDonni, Inc. v. Hart, 355 Mass. 580, 246 N.E.2d 446, 449 (1969) (In the absence of an express agreement, a contract implied in fact may be found to exist from the conduct and relations of the parties.). Boyle admits that Navistar compensated him in full for all sales and services performed for its benefit until the time when their relationship was dissolved. If there was a contract implied in fact, it consisted of a promise of payment for these services rendered. Moreover, an implied in fact dealership claim cannot reasonably be inferred after Navistar expressly rejected Boyle's dealership application. The fact that for several months after officially denying Boyle the dealership Navistar engaged him in many of the same business activities that it had with its official dealers did not impose upon Navistar the further obligation to deal with Boyle like a dealer under contract.