Metro-Goldwyn-Mayer, Inc. v. Scheider

Citation. 22 Ill.40 N.Y.2d 1069, 392 N.Y.S.2d 252, 360 N.E.2d 930 (1976)

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Citation22 Ill.40 N.Y.2d 1069, 392 N.Y.S.2d 252, 360 N.E.2d 930 (1976)

Brief Fact Summary. The Appellant, Scheider (Appellant), agreed to be a principal actor in a pilot film and in any ensuing television series, which could develop therefrom. The Appellant later refused to be in the series, after being fully compensated for performing in the film.

Synopsis of Rule of Law. This case stands for the proposition that when a party to a contract begins performance under an understanding that an agreement has been entered into, he will be bound to complete his performance.

Points of Law - Legal Principles in this Case for Law Students.

However, where the parties have completed their negotiations of what they regard as essential elements, and performance has begun on the good faith understanding that agreement on the unsettled matters will follow, the court will find and enforce a contract even though the parties have expressly left these other elements for future negotiation and agreement, if some objective method of determination is available, independent of either party's mere wish or desire.

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Facts. The trial court found that, by performing in the film, Appellant began performance on the good faith assumption there was an agreement and although terms were incomplete, the court was within its discretion to find and enforce an agreement. Judgment for the Appellee, Metro-Goldwyn-Mayer (Appellee). Appellant appealed.

Issue. This case presents the question of whether there was a complete contract, arising from an oral agreement between the parties, which could be upheld.

Held. Affirmed.
When performance is begun, under the understanding that an agreement has been reached, regardless of its incompleteness, the court is within its discretion to find a contract exists and to hold a party liable for breach when it refuses to perform. In this case, Appellant began performance by appearing in a pilot film and by accepting payment for his appearance in that film. When he subsequently refused to be in the ensuing television series, he was in breach, because he had accepted the agreement by his prior performance.

Discussion. Again, it is important to look to the intention of the parties, in determining whether a contract was meant to be created. Performance in furtherance of an agreement is a good indicator that an agreement did, in fact, exist.

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