Kabil Developments v. Mignot

Supreme Court of Oregon, 1977.

279 Or. 151, 566 P.2d 505.

Dawson, pp. 329-333


Facts: The plaintiff alleges that the defendants orally agreed to supply the plaintiffs with helicopter services.  The defendants denied there was a contract.  At trial, testimony was admitted that the plaintiffs subjectively thought they had a deal with the defendants.  The plaintiffs won.  The defendants appealed on the basis that the subjective testimony of the plaintiffs shouldn’t have been admitted.


Issue: Was the jury allowed to erroneously find a contract on the basis of a subjective standard instead of an objective standard?


Rule: When a court determines whether a party has assented to an agreement, the only intention that matters is the party’s apparent, objective intention (or the intention that a “reasonable person” would infer).


Analysis: The subjectivists and objectivists fought it out over many, many years, but the objectivists pretty much won out.  The jury is only to consider whether a reasonable person would have inferred a promise on the part of the defendants.  However, the court finds that subjective evidence is relevant, though not completely determinative.  The court also finds that the jury was not instructed incorrectly.


Conclusion: The judgment for the plaintiffs was affirmed.


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