UNPUBLISHED

UNITED STATES COURT OF APPEALS

FOR THE FOURTH CIRCUIT

CRANBROOK INVESTORS, LIMITED, A
Texas Limited Partnership,
Plaintiff-Appellant,

v.

GREAT ATLANTIC MANAGEMENT
COMPANY, INCORPORATED, A Virginia
Corporation; EDWIN A. JOSEPH, JR.;
                                                                      No. 98-2631
CRANBROOK, INCORPORATED, A
Virginia Corporation; ATLANTIC
PROPERTIES ASSOCIATES, LIMITED
PARTNERSHIP, A Maryland Limited
Partnership; ATLANTIC PROPERTIES
TRUST, INCORPORATED, a Maryland
Corporation,
Defendants-Appellees.

Appeal from the United States District Court
for the Eastern District of Virginia, at Newport News.
Raymond A. Jackson, District Judge.
(CA-97-97-4)

Argued: September 23, 1999

Decided: November 10, 1999

Before MURNAGHAN and MOTZ, Circuit Judges,
and GOODWIN, United States District Judge
for the Southern District of West Virginia, sitting by designation.

_________________________________________________________________

Reversed and remanded by unpublished per curiam opinion.

_________________________________________________________________
COUNSEL

ARGUED: Walter DeKalb Kelley, Jr., WILLCOX & SAVAGE,
P.C., Norfolk, Virginia, for Appellant. Charles Frederick Witthoefft,
HIRSCHLER, FLEISCHER, WEINBERG, COX & ALLEN, P.C.,
Richmond, Virginia, for Appellees. ON BRIEF: Michael R. Katch-
mark, WILLCOX & SAVAGE, P.C., Norfolk, Virginia, for Appel-
lant. Ian J. Wilson, HIRSCHLER, FLEISCHER, WEINBERG, COX
& ALLEN, P.C., Richmond, Virginia, for Appellees.

_________________________________________________________________

Unpublished opinions are not binding precedent in this circuit. See
Local Rule 36(c).

_________________________________________________________________

OPINION

PER CURIAM:

Cranbrook Investors, Ltd. filed the instant case on August 15, 1997
against Great Atlantic Management Company, Inc., its officers and
related entities. The suit arose out of a purported agreement between
the parties to become partners in a real estate venture. Cranbrook
alleged causes of action for breach of contract, common law fraud,
violation of federal securities laws and promissory estoppel. The
cause of action for violation of the federal securities laws was volun-
tarily dismissed with prejudice by an order entered on March 27,
1998. On May 5, 1998, the district court entered summary judgment
in favor of the defendants on Cranbrook's cause of action for promis-
sory estoppel. Neither of those decisions is a subject of Cranbrook's
appeal.

On September 30, 1998, the district court granted summary judg-
ment to the defendants as to the remaining causes of action for breach
of contract and common law fraud. That decision is the only subject
of this appeal.

In its September 30 opinion, the district court observed that relating
to the motion for summary judgment, "a great deal of extraneous

                    2
information has been asserted by the parties." The same is true on
appeal. However, we will deal with only the salient issues.

In 1994, defendants sold a 49% interest in Cranbrook Club Apart-
ments ("CCA") to plaintiff. CCA was the second property the parties
had owned as partners with one another.

In February 1995, the defendants undertook to sell CCA to a third
party. Under the Limited Partnership Agreement for CCA, Cranbrook
reserved the right to block any sale of CCA unless the sale proceeds
were sufficient to pay off Cranbrook's capital contribution and a spe-
cial "preferred return." However, ongoing renovations to CCA had
proven costly, and its market value had fallen. Under these circum-
stances, Cranbrook asserted that its consent was required for the
defendants to sell (though defendants have contested that interpreta-
tion).

The defendants requested that Cranbrook approve the sale, but it
refused, believing that a greater amount would be realized if the trans-
action were delayed. Cranbrook expressed its desire to be "made
whole" on its investment.

The parties began discussing possible solutions. According to
Cranbrook, one possibility was to make it "whole" by granting it a
partnership interest on favorable terms in another of defendants' prop-
erties, Banyan Bay Apartments. In exchange, Cranbrook would give
its consent to the sale of CCA. Cranbrook testified that the parties
reached a verbal understanding of the terms on which they would
strike the deal.

The defendants, on the other hand, claimed that Cranbrook's con-
sent was never required for the sale of Banyan Bay. They have argued
that the negotiations for the partnership interest in Banyan Bay were
independent of the defendants' sale of CCA.

On April 22, 1996, Cranbrook's President, John Heikenfeld, sent
a letter to Aubrey Lane of the defendants. The letter stated that "[w]e
approve the sale of Cranbrook Apartments under the following condi-
tions." It then recited two paragraphs of economic details regarding
the transaction. At the end, it stated:

                    3
          [i]f Mr. Joseph can confirm this condition in writing and
          provide the documents that complete this transaction such as
          the Limited Partnership Agreement on Banyan Bay, then we
          are prepared to go forward.

Edwin Joseph, the defendants' president, signed the letter, indicating
that he had "READ, AGREED AND ACCEPTED" it, and returned
the letter to Cranbrook.

According to Cranbrook, the phrase "we are prepared to go for-
ward" indicated that Cranbrook would execute and deliver a consent
form agreeing to the sale of CCA, which defendants needed to close
the sale. According to the defendants, the same phrase meant that the
parties would continue to the next stage of negotiations on the Banyan
Bay deal.

Upon receiving the signed letter, Cranbrook executed and delivered
a consent form to the defendants, which the defendants used to close
the CCA sale. The defendants, however, refused to honor the terms
of the letter agreement concerning Banyan, contending that no con-
tract had ever been formed concerning the Banyan Bay transaction.

Cranbrook has contended in this appeal that the district court erred
in granting summary judgment to the defendants. A district court's
grant of summary judgment is reviewed de novo . See, e.g., Sempione
v. Provident Bank of Maryland, 75 F.3d 951, 954 (4th Cir. 1996). We
view all disputed facts in the light most favorable to the non-moving
party, Cranbrook. See Anderson v. Liberty Lobby , 477 U.S. 242, 255
(1986).

The district court held that no contract was created, in part because
Cranbrook had made no showing that a meeting of the minds
occurred. In particular, the letter agreement specified that a partner-
ship agreement for Banyan Bay was to be drawn up, but that was
never done. In response, Cranbrook has argued that the parties under-
stood that the partnership agreement was to be modeled "pro forma"
after the existing partnership agreement for CCA. Thus, Cranbrook
has contended, the minds had met as to all material terms of the trans-
action.

                    4
For a contract to exist, the parties' must have a meeting of the
minds; the parties therefore must agree on all material terms. See
Smith v. Farrell, 199 Va. 121, 127-28, 98 S.E.2d 3, 7 (1957). A meet-
ing of the minds requires a manifestation of mutual assent. See Wells
v. Weston, 229 Va. 72, 78, 326 S.E.2d 672, 676 (1985).

The parties need not explicitly discuss all material terms, however.
An agreement on certain terms may be implied by the court based
upon usage of trade or course of dealing. See generally Corbin on
Contracts § 568 (1960). When the parties agree upon the "general
scope and stipulations" of a contract, the court will not void the con-
tract for incompleteness. Coastland Corp. v. Third Nat. Mortgage
Co., 611 F.2d 969, 976 (4th Cir. 1979). Rather, the court will imply
any indefinite terms. See id.

Cranbrook has not contested that the contents of the partnership
agreement were material. The issue, according to it, therefore, is sim-
ply whether the parties "manifested mutual assent," either explicitly
or implicitly, to the contents of the partnership agreement.

The parties agree that the contents of the partnership agreement
were not discussed during the negotiations that culminated in the let-
ter agreement of April 22, 1996. Both sides attach meaning to this
silence. The defendants have claimed that the parties' silence mani-
fested a lack of agreement on the issue. To the contrary, Cranbrook
has taken the position that, through silence, the parties manifested
their satisfaction with the existing partnership agreement for CCA,
and jointly they expected that it would be adopted pro forma for Ban-
yan Bay.

Cranbrook has sought to establish a course of dealing based on
only one prior "dealing" between the parties: the CCA.* Cranbrook
has argued, however, that rather than constituting merely a single
"dealing," the CCA constituted a series of ongoing dealings between
the parties. In other words, the course of dealing was the everyday
relationship between the parties that the partnership agreement had
_________________________________________________________________
*The parties were partners in another venture before CCA, but neither
party discusses the terms of that partnership agreement or its implication
on "course of dealing."

                    5
established. Neither party had ever expressed any dissatisfaction with
that relationship. Therefore, Cranbrook argued, both parties assumed
that the relationship between the parties, as established by the terms
of the CCA, would continue.

There is a material question of fact for a jury to decide. The presen-
tation of evidence at trial would help illuminate such disputed issues
as whether partnership agreements of this type are normally individu-
alized or standardized; whether the CCA could have been uniformly
adapted to Banyan Bay; and, ultimately, whether the parties had in
fact implicitly agreed to adapting the CCA for Banyan Bay. If the jury
decides that the parties implicitly agreed through their course of deal-
ing to use the CCA partnership form for the Banyan Bay partnership,
then a "meeting of the minds" did indeed occur, for parties may agree
on contract terms without discussing them explicitly. Coastland, 611
F.2d at 976; Corbin on Contracts § 568. Therefore, the district court
erred in ruling that, as a matter of law, there was no "meeting of the
minds."

The district court also held that no contract was created because
Cranbrook did not intend to be bound by the letter agreement. The
court based its decision primarily on the language in the letter agree-
ment, which it felt created no present commitment.

The question of whether a future writing is required to create a
binding commitment is one of intent. If the parties intend to be bound
and fully agree, then the preparation of a formal written instrument
is merely a formality, and the stated intention to prepare such a for-
mality will not prevent a reviewing court from finding an enforceable
contract. See, e.g., Snyder-Falkinham v. Stockburger, 249 Va. 376,
385, 457 S.E.2d 36, 41 (1995). In other words, the key is whether the
parties intend to be bound absent a future writing. See Boisseau v.
Fuller, 96 Va. 45, 46-47, 30 S.E. 457, 457 (1898). A party's internal,
subjective intent is irrelevant; the key is the party's manifestation of
intent. See Lucy v. Zehmer, 196 Va. 493, 502, 84 S.E.2d 516, 521
(1954). The question is normally one for the trier of fact, as expressed
by the Fourth Circuit:

          While there may of course be situations in which the mani-
          festations of intention of both parties to be bound, or of

                    6
          either not to be bound, are so unequivocal as to present no
          genuine issue of fact, this will but rarely be so in protracted
          negotiations involving a "jumble of letters, telegrams, acts,
          and spoken words." Restatement (Second) of Contracts,
          § 21A, Comment a. Ordinarily in such cases, the issue
          whether there has at any time been the requisite manifesta-
          tion of mutual assent to a bargained exchange will be one
          of fact in genuine dispute so as to preclude summary judg-
          ment.

Charbonnages de France v. Smith, 597 F.2d 406, 415 (4th Cir. 1979).

In the instant case, the language of the letter agreement is critical.
John Heikenfeld, Cranbrook's president, wrote "[w]e approve the sale
of Cranbrook Apartments under the following conditions." He then
recited two paragraphs of economic details regarding the transaction.
At the end, he wrote

          [i]f Mr. Joseph can confirm this condition in writing and
          provide the documents that complete this transaction such as
          the Limited Partnership Agreement on Banyan Bay, then we
          are prepared to go forward.

Edwin Joseph, the defendants' president, signed the letter, indicating
that he had "READ, AGREED AND ACCEPTED" it, and returned
the letter to Cranbrook.

The district court focused on the phrase "and provide the docu-
ments that complete this transaction such as the Limited Partnership
Agreement on Banyan Bay, then we are prepared to go forward," con-
cluding that the language was "not ambiguous" in expressing that
Cranbrook did not intend to be bound until additional writings were
created. The court looked to the following passage from John Heiken-
feld's deposition:

          Q: It is correct, is it not, Mr. Heikenfeld, on behalf of
          Cranbrook Investors you were not prepared to make this
          investment in Banyan Bay without a limited partnership
          agreement?

                    7
          A: Among other things, yes.

          Q: By among other things you mean other documents typi-
          cal for an investment of this magnitude in a real estate deal?

          A: Correct.

It is possible, however, to read the letter agreement as manifesting
Cranbrook's intent to be bound immediately. First, in his affidavit,
Heikenfeld explained that the phrase "then we are prepared to go for-
ward" referred to sending the defendants the consent form. Although
a party's subjective intent is irrelevant, it appears from a purely objec-
tive standpoint that the phrase is indeed susceptible to such an inter-
pretation. The interpretation is also consistent with the parties' course
of dealing. According to Cranbrook, they had negotiated over Cran-
brook's consent to the CCA sale for many months. Cranbrook had
withheld its consent, up until the negotiations over Banyan Bay that
culminated in the letter agreement. Under these circumstances, it is
disputable whether the phrase "then we are prepared to go forward"
indicated that Cranbrook would "go forward" with submitting the
consent form to the defendants.

Second, a different interpretation is possible for the phrase "and
provide the documents that complete this transaction such as the lim-
ited partnership agreement for Banyan Bay." If, as Cranbrook has
claimed, the parties expected to use the same basic partnership agree-
ment for Banyan Bay as for CCA, then Cranbrook was manifesting
an intent to adopt the CCA partnership agreement pro forma, without
future negotiations. Moreover, when the defendants' president signed
the letter agreement indicating that he had "READ, AGREED AND
ACCEPTED" the terms of the letter, he was manifesting his own
intent to adopt that partnership agreement without further negotiation.
Under such an interpretation, a contract would be formed.

Finally, Heikenfeld's deposition statements are consistent with this
reading. If the partnership agreement and other documents were mere
formalities, Heikenfeld's admission that they were required would not
defeat Cranbrook's claim of being immediately bound.

                     8
This is not one of those rare cases where summary judgment is
appropriate on the issue of whether the parties intended to be immedi-
ately bound. See Charbonnages, 597 F.2d at 415. The parties dispute
whether they had implicitly agreed that the limited partnership agree-
ment from Cranbrook Club was to be adapted pro forma to fit Banyan
Bay. The resolution of that issue of fact directly bears on whether the
letter agreement constituted a manifestation of intent to be immedi-
ately bound.

A material issue of fact exists as to whether the parties intended to
be immediately bound. Thus, the district court should not have
granted summary judgment at this stage. The case is therefore
reversed and remanded for proceedings in accordance with this opin-
ion.

REVERSED AND REMANDED

                    9
