Donovan v. Rrl Corp.

26 Cal..4th 261 (2001)

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Nature of the Case

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Facts

In the Costa Mesa Daily Pilot, P noticed a full-page advertisement placed by D. It clearly identified a specific vehicle and stated a price of $25,995. P visited a Jaguar dealership that offered other 1995 Jaguars for sale at $8,000 to $10,000 more than the price specified in D's advertisement. P went to D and saw the car. After a test drive, P offered to purchase the car at the advertised price. When shown the advertisement, the salesperson immediately stated, 'That's a mistake.' The sales manager also told P that the price listed in the advertisement was a mistake. The sales manager apologized and offered to pay for P's fuel, time, and effort expended in traveling to the dealership to examine the automobile. D refused to sell the car at the advertised price. P sued D, and at trial, it was discovered. that the employees of the Daily Pilot did not replace the description of the 1995 Jaguar with the description of the 1994 Jaguar but did replace the word 'Save' with the price of $25,995. Thus, the Saturday, April 26, edition of the Daily Pilot erroneously advertised the 1995 Jaguar XJ6 Vanden Plas at a price of $25,995. The Daily Pilot acknowledged its error in a letter of retraction sent to D on April 28. D was unaware of the mistake until P attempted to purchase the automobile. In May 1997, D's advertisements in several newspapers listed the 1995 Jaguar XJ6 Vanden Plas for sale at $37,995. Defendant subsequently sold the automobile for $38,399. The municipal court entered judgment for D. The court held that in the present case there was no valid offer because D's unilateral mistake of fact vitiated or negated contractual intent. The court made factual findings that D's mistake regarding the advertisement was made in good faith and was not intended to deceive the public. P appealed. The appellate department reversed the judgment on Vehicle Code section 11713.1, subdivision (e). The advertisement constituted an offer capable of acceptance by tender of the advertised price. The Court of Appeal reasoned that Vehicle Code section 11713.1, subdivision (e), 'tips the scale in favor of ... construing the advertisement as an offer ....' The court disagreed with the municipal court's conclusion that D's unilateral mistake of fact, unknown to P at the time he tendered the purchase price, precluded the existence of a valid offer. D's failure to review a proof sheet for the Daily Pilot advertisement constituted negligence that contributed to the placement of the erroneous advertisement. D appealed.