Procedural Posture

Defendants appealed from an order of the Superior Court of Los Angeles County (California), entering judgment in favor of plaintiffs in an action to recover damages for breach of oral agreement.

Nakase Law Firm explains intentional interference with contractual relations California

Overview

Plaintiffs entered into an oral agreement with defendants granting defendants the right to use the title of plaintiff author's book. The agreement was limited to the title only and did not include the book itself. When the agreement was put into writing, defendants included a "covenant of nonsuit" exempting them from liability for any similarities between the book itself and any motion picture they made using the title. Plaintiffs refused to agree to the covenant, but insisted that defendants follow through with the oral agreement as to the title only. The trial court found that the oral agreement was binding. On appeal, the court affirmed, holding that when parties orally agree upon all the terms and conditions of an agreement with the mutual intention that it would be binding, the fact that a formal written agreement was to eventually be prepared did not alter the binding nature of the agreement.

Outcome

The court affirmed, holding that where parties intended to be bound, the binding nature of the oral agreement was not altered despite a plan to reduce the agreement to writing.