Contracts Case Brief # 5

Title and Citation: Izadi v. Machado (Gus) Ford, Inc., 550 SO.2d 1135
(1989)
Identities of Parties: D (Machado) put out an advertisement and P
(Izadi) who wanted to trade in his car.
Procedural History: P filed suit for breach of contract, fraud, and
statutory violations. The trial court dismissed the claim for fraud and
found in favor of D on the remaining claims. P appealed to the Florida
District Court of Appeal.
Facts: The P saw the ad decided to purchase a 1988 ford ranger from
the D for $3,595 using the trade in a allowance deal and cash. Based
on the Defendants advertisement, the Plaintiff believed that any
trade-in, regardless of value, would be offered a $3,000 allowance.
Plaintiff mistakenly thought the allowance applied to the purchase of
any new vehicle. In fine print the ad indicated that the allowance
applied to only two vehicle models, nether of which Plaintiff was
attempting to purchase. D however, in fact refused to recognize this
interpretation of its advertisement and turned P down. Small print
indicated that it applied only towards the purchase of any New 88
Eddie Bauer Aerostar or Turbo T-bird in stock neither which were
mentioned in the ad. In addition, the individual vehicle portions of the
ad indicated the offer only applied to trade-ins worth at least $3,000. P
then brought the present action based on claims of: (1) Breach of
contract, (2) Fraud (3) Statutory violation involving misleading
advertising. The lower court dismissed the P lawsuit with prejudice
and as a response the P appealed
Would be seller is Ford dealer and would be buyer is Izadi
A reasonable person would think that a contact was formed when
P came in to the dealership with the money
Issue(s): Can an enforceable contract arise from an offer contained in
an advertisement?
Holding and Rule: Yes, The test of the true interpretation of an offer
or acceptance is not what the party making it thought it meant but
what a reasonable person thought it meant.
The advertisement is a considered an offer
Courts Reasoning: Yes. An enforceable contract may arise from an
offer contained in an advertisement if it objectively appears that one
exists. The advertisement must be viewed as a whole, with emphasis

placed on provisions that are seemingly inconsistent or conflicting. The

subjective intent of the party responsible for the advertisement has no
merit in the consideration. Even if the advertisement does not
objectively appear to contain an offer, an enforceable contract may
nonetheless be implied if the party responsible for the advertisement
attempted to deliberately mislead the reader into concluding that an
offer exists. An enforceable contract will be implied when an
advertisement uses the bait-and-switch tacticluring the reader in
with one offer, but then refusing to honor that offer while making a
lesser offer. In the current matter, the overall message of the
advertisement is that D agrees give $3,000 for any trade-in on any
Ford. The superfine print and qualification of the offer as to the value of
the trade-in are contradictory to the far-more prominent message of
the advertisement. It is irrelevant that D did not intend to provide a
blanket offer of $3,000 for any trade-in on any Ford, because the
advertisement clearly makes that offer. Additionally, even if the
advertisement did not objectively appear to contain an offer, D use of
the bait-and-switch tactic would lead to an implied offer. The wording
and arrangement of the advertisement clearly indicate that D did not
intend to honor the $3,000 trade-in offer, but to offer something less
when a customer attempted to accept the $3,000 trade-in offer.
Regarding P statutory claims, based upon the facts concerning the
misleading nature of the advertisement, P has raised valid claims for
violations of Floridas Deceptive and Unfair Trade Practices Act.
Judgment and Order: The decision of the trial court is affirmed in
part, reversed in part and remanded for further proceedings.