Thomas L. Swarek v. Derr Plantation, Inc., 227 So. 3d 903

Background

Derr Plantation, an 8,355-acre Mississippi Delta farm, was owned by Wohnbau Derr, the sole shareholder of Derr Plantation, Inc. (DPI). Thomas L. Swarek (father) negotiated to lease then purchase the property in late 2004–early 2005.
Negotiations produced a series of exchanged letters and draft contracts: Swarek offered $7 million; DPI counteroffered lease-then-purchase structures, culminating in a February 10 letter stating DPI was "ready and willing" to accept Swarek’s January 27 proposals (three lease payments totaling $750,000 over two years and $7.5M purchase price, with drafted contracts to be executed by March 1, 2005).
On February 14, 2005, a typed bilingual document incorporating the February 10 terms was handwritten/typed, signed by Swarek, Witt (DPI’s agent), and Derr; parties did not execute the detailed lease or sale contracts at that meeting.
Two days later Swarek told DPI he had made a mistake: he intended fewer lease payments and a different closing date, which changed the total consideration. He proposed revised terms and threatened to withdraw if DPI insisted on the February 10 terms.
DPI responded with a February 18 proposal accepting revised terms but requiring additional earnest-money guarantees; Swarek refused because he wanted a "firm and binding" agreement and did not accept the new guarantee language. Negotiations then broke down and DPI ceased communications.
The chancery court held the February 14 document was incomplete and not an enforceable contract (no meeting of the minds) and that, even if enforceable, Swarek repudiated it. The Mississippi Supreme Court affirmed.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether the February 14 document was a binding, enforceable contract for lease and sale	The February 14 instrument incorporated the February 10 terms and was "firm and binding," so it created an enforceable contract entitling Swarek to specific performance	The document was incomplete, left material terms unresolved, and was not intended as a final contract	Court: No; parties did not reach meeting of the minds and instrument was not a valid, enforceable contract
Whether the chancery court should have fixed a reasonable time to execute the detailed contracts or ordered performance	Swarek: Court should have set a reasonable time and ordered parties to sign the promised lease and sale agreements	DPI: Parties never agreed on material terms; court cannot force completion of an agreement that lacks mutual assent	Court: No; because no enforceable contract existed, court need not impose completion or enforcement timelines
Whether the February 14 document's "firm and binding" language precluded consideration of extrinsic testimony about intent	Swarek: Clear language made the agreement binding; parol evidence/extrinsic testimony should not defeat that plain language	DPI: Extrinsic evidence shows parties did not intend a final contract and the document was incomplete; evidence of repudiation is admissible	Court: Permitted consideration of testimony; the language did not negate the lack of mutual assent or Swarek’s later repudiation
Whether Swarek’s later communications constituted repudiation that excused DPI from performance	Swarek: He remained ready, willing, and able to perform the February 10 terms	DPI: Swarek materially varied terms, demanded renegotiation, and threatened to withdraw—constituting repudiation	Court: Held Swarek materially repudiated the terms; DPI was excused from further performance

Key Cases Cited

Gulf South Capital Corp. v. Brown, 183 So. 2d 802 (Miss. 1966) (repudiation or material breach by one party excuses the other from performance)
Prestenbach v. Collins, 159 So. 3d 531 (Miss. 2014) (discussing enforceability of option contracts and related requirements)
Creely v. Hosemann, 910 So. 2d 512 (Miss. 2005) (addressing validity and enforcement of option agreements)