The case revolves around Joe Wedeking, who owned a mobile home park and was negotiating with MSS Capital, LLC (MSS) for the potential sale of the property. The central issue was whether there was a valid contract for the sale of the mobile home park. MSS argued that a valid contract existed and filed a specific performance claim to force the sale to close.
A key fact in the dispute was that an offer from MSS to Wedeking was to be accepted by 5:00 p.m. on November 30, or it would be considered expired. On December 5, Wedeking signed the agreement and had his attorney send it to MSS with due diligence documents.
Afterward, Wedeking asked MSS to send a new purchase agreement correcting the date in the first contract. MSS did so but included the following statement: “We have agreed to sign a new purchase agreement that is within the time frame before the agreement expires. The agreement attached expires on January 4, 2024.” Wedeking never signed the January 4 agreement. He later argued that no deal was ever struck because the original deadline had already expired.
The district court found that Wedeking’s December 5 signature and transmission of documents constituted a counteroffer, which MSS accepted. The record showed that Wedeking knowingly signed the first agreement despite the incorrect date and never intended to sign the follow-up agreement. His intent, according to testimony, was to keep a potential buyer engaged for the benefit of his children after his eventual passing. However, the court held by the very nature of a signature on a contract in this case, Wedeking showed he agreed with the contract and its terms.
Generally, acceptance must strictly comply with the conditions in a purchase agreement. A party cannot accept an offer after it has lapsed, nor can the offeror elect to treat acceptance of a lapsed offer as binding. However, Iowa precedent treats late acceptance as a counteroffer, and if the other party accepts it without altering terms, a valid contract is formed. Both the district court and the Iowa Court of Appeals held that MSS accepted the counteroffer, creating a binding agreement. Wedeking was ordered to perform the contract and complete the sale of the mobile home park.
The lesson from this case is straightforward: do not enter into agreements without the intent or ability to follow through. Wedeking will not be able to leave the property to his children, and as the facts indicate, he will now face additional estate planning complications.