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2021 Ohio 4308
Ohio Ct. App.
2021
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Background

  • Kertes (seller/builder) and the Sanders (buyers) signed a purchase agreement for a new single-family home with a handwritten term: the parties agree to execute the builder’s purchase agreement (BPA) within 5 days; earnest money $7,000.
  • The BPA was not produced within five days; when the Sanders received it they discovered undisclosed obligations/fees (e.g., $3,500 capital contribution, $1,000 maintenance fee, three months dues) and detailed basement-construction terms that altered price/obligations.
  • The Sanders notified Kertes they would not close and demanded return of earnest money; Kertes sued for breach of contract and damages; Sanders counterclaimed among other defenses.
  • Trial court originally declared the purchase agreement void and returned earnest money; this court reversed that declaration on first appeal and remanded to decide whether a binding contract existed and whether a breach occurred.
  • On remand the trial court granted summary judgment for the Sanders, finding the BPA term was material and the parties never reached a meeting of the minds because they never agreed to the BPA; Kertes’ motion for summary judgment was denied.
  • The Eighth District affirmed: the BPA contained essential price/obligation terms and an integration clause; because the parties never agreed to the BPA, no binding contract formed and no breach occurred.

Issues

Issue Plaintiff's Argument (Kertes) Defendant's Argument (Sanders) Held
Whether the handwritten term requiring execution of a BPA was a material term and whether Kertes breached by not "timely" providing it BPA was not a material term; the signed agreement was integrated and binding without the BPA BPA was the final memorialization; it contained essential price/obligation terms and was material; parties were bound only upon agreement to BPA BPA was material; because parties never agreed to BPA there was no meeting of the minds and no enforceable contract
Whether Kertes was entitled to summary judgment on its breach-of-contract claim Kertes performed and Sanders breached by refusing to close No enforceable contract existed because essential terms remained unresolved in the unsigned BPA Kertes’ motion denied; summary judgment for Sanders affirmed (no breach)

Key Cases Cited

  • Kertes Enters., L.L.C. v. Sanders, 137 N.E.3d 733 (8th Dist. 2019) (prior appellate decision describing the parties’ negotiations and procedural history)
  • Kostelnik v. Helper, 770 N.E.2d 58 (Ohio 2002) (contract formation requires offer, acceptance, consideration, mutual assent)
  • Bellman v. Am. Internatl. Group, 865 N.E.2d 853 (Ohio 2007) (writing that appears complete is presumed to be an integrated agreement)
  • Episcopal Retirement Homes v. Ohio Dept. of Indus. Rels., 575 N.E.2d 134 (Ohio 1991) (contract must be definite and show a meeting of the minds)
  • Oglebay Norton Co. v. Armco, 556 N.E.2d 515 (Ohio 1990) (enforceability of preliminary agreements depends on parties’ intent to be bound)
  • Doner v. Snapp, 649 N.E.2d 42 (Ohio App.) (elements of breach of contract)
  • Borkey v. J.F. Glaze Cleveland L.L.C., 18 N.E.3d 820 (8th Dist. 2014) (preliminary agreements enforceable only if parties intended to be bound and terms are sufficiently definite)
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Case Details

Case Name: Kertes Ents., L.L.C. v. Sanders
Court Name: Ohio Court of Appeals
Date Published: Dec 9, 2021
Citations: 2021 Ohio 4308; 109584
Docket Number: 109584
Court Abbreviation: Ohio Ct. App.
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    Kertes Ents., L.L.C. v. Sanders, 2021 Ohio 4308