## Facts

- Steve L. Hendricks (an escrow holder) held a $5,000 deposit paid by Eugene Behee in connection with Behee’s written offer to buy real estate owned by Artice and Pearl Smith.
- After negotiations, Behee made a written offer dated March 2, 1987, to purchase the real estate for $42,500 (and additional personal property for $250).
- The offer was mailed to the Smiths in Mississippi through real estate agents; the trial court found the agents acted for the Smiths.
- On March 4, 1987, the Smiths signed the proposed agreement in Mississippi.
- Before Behee received notice that the Smiths had accepted, Behee withdrew his offer by contacting the Smiths’ real estate agent on March 5, 6, or 7; Behee had received no notice of acceptance before that communication.
- Hendricks filed an interpleader to determine whether Behee or the Smiths were entitled to the deposit after the parties disputed whether a contract existed.

## Issues

1. Whether a bilateral contract was formed when the sellers signed the agreement but did not communicate acceptance to the offeror before the offeror revoked.
2. Whether revocation communicated to the sellers’ real estate agent constituted effective notice of revocation to the seller principals.
3. Whether the buyer’s offer was irrevocable absent consideration supporting an option or other basis to keep the offer open.

## Decision

- The trial court awarded Hendricks $997.50 from the deposit for services and awarded the remaining $4,002.50 to Behee.
- The Missouri Court of Appeals affirmed.
- The court held no contract formed because acceptance was not communicated to Behee before he revoked the offer.
- The court treated Behee’s notice of withdrawal to the Smiths’ agent as notice to the Smiths, making the revocation effective before any communicated acceptance.

## Legal Principles

- In a bargain calling for a promise, no contract arises until acceptance of the offer is communicated to the offeror; an uncommunicated intention to accept is not an acceptance.
- Unless an offer is supported by consideration making it irrevocable (such as an option), the offeror may withdraw the offer at any time before acceptance is effectively completed (including required communication).
- Revocation is effective when communicated to the offeree before effective acceptance occurs.
- Notice to an agent, within the agent’s authority, is imputed to the principal; the agent’s knowledge is treated as the principal’s knowledge.

## Conclusion

Because the sellers’ signed acceptance was not communicated to the buyer before he revoked, and because the buyer’s revocation to the sellers’ agent counted as notice to the sellers, no contract was formed and the buyer was entitled to the remaining escrowed deposit.


Hendricks v. Behee, 786 S.W.2d 610 (Mo. Ct. App. 1990)