Sterling v. Taylor

Donald Sterling (plaintiff) sought to buy three apartment buildings from a partnership in which Lawrence Taylor (defendant) was a general partner. Sterling drafted a memorandum with a price formula (roughly 10.468 times gross income, estimated at $1,600,000) that both parties intended to yield $16,750,000, though a clerical error garbled the written figure; only Sterling initialed it. A later signed letter discussed deposits but not price. When Taylor sent formal purchase agreements listing $16,750,000, Sterling refused to sign, having discovered actual rental income was only $1,375,404 — which, run through the memorandum's own formula, produced a lower price of about $14,404,841. Taylor wouldn't lower the price, and Sterling sued for breach of contract. Taylor argued the alleged contract violated the statute of frauds because the price term was too uncertain; the trial court agreed and granted summary judgment, the Court of Appeal reversed based on extrinsic evidence, and Taylor appealed.