Renner v. Kehl

Roy Renner and his business associates (Renner) (plaintiffs) agreed to buy leaseholds on over 2,000 acres from the Kehls and Moyles (Kehls) (defendants), both sides understanding Renner planned to grow jojoba, a crop that needed adequate underground water, and both believing the land had enough water for that purpose. After making a down payment, taking the leaseholds, and drilling five test wells, Renner discovered there wasn't enough water of sufficient quality for commercial jojoba growing, and sued to rescind the contract. The trial court granted rescission for mutual mistake and ordered the Kehls to return Renner's down payment plus consequential damages covering Renner's development expenses, including the test wells; the court of appeals affirmed, and the Kehls appealed to the Arizona Supreme Court.