A man who was informed by the car dealer that his application for a loan for the purpose of purchasing a car had been denied, was surprised to learn that the lender had provided a loan in his favor and transferred the loan money to the car dealer, based on forged documents and a video in which the man states to the lender that he "approves a transaction."
The Court rejected the lender's contentions, which sought to rely on the video as a binding contract, due to the lack of specificity and in light of the increased duty of care imposed on it. In addition to the parties' intention to enter into a contract with each other, for the purpose of concluding a contract, the offer must be sufficiently detailed so that its acceptance by the other party is sufficient to form a binding agreement. Beyond the standard duty of care of a lender to ensure that the borrower is aware that the loan transaction has entered into effect, when the loan funds are transferred directly from the lender to a third party and not to the borrower, the lender has an increased duty of care to ensure that the borrower is aware of the terms of the transaction. Here, the lender received a video from a car seller in which a person states that he "approves a transaction" to the lender, without any reference to the nature of the transaction, the amount of the loan or its terms. As it is not possible to assert that the intention of the person being photographed is to enter into a loan transaction, and as the general approval in the video lacks the basic details required to meet the specification requirement, and the lender did not bother to verify the borrower's awareness, no contract was entered into between the parties.