Ch 10 blaw 495

Implied authorized methods of acceptance

1) any means that is as fast or faster than the method identified as acceptable by the offeror and 2) US mail is always implied acceptable when the parties are bargaining at a distance --N.B.

The mailbox rule

An acceptance becomes effective upon being placed in the mailbox by the offeree

N.B.

An acceptance communicated by means not expressly or implied authorized is not effective until it is received by the offeror

Lapse of time

An offer terminates automatically when the time period specified in the offer expires

Death or incompetence

An offeree's power to accept is terminated when the offeree or the offeror dies or is deprived of legal capacity to enter into contract , unless the offer is irrevocable, in which case only the offeree's death or incompetence will terminate the offer

A revocation becomes effective upon its receipt by the offeree as an ACCEPTANCE becomes effective upon its...

Dispatch by the offeree to the offeror

What reasons would create termination by operation of law of a contract

Lapse of time, destruction of subject matter , death or incompetence, illegality

What are option contracts

The offeror cannot revoke his or her offer for a stipulated time period during which the offeree has the sole right of acceptance. The offeree must give the offeror "valuable consideration" to make an option contract irrevocable

Rejection

The terms of the offer may be rejected by the offeree, in which case the offer terminates

What if no time period is stated in the terms of the offer?

Then the offer will terminate after a reasonable period of time has expired

"click on" acceptances

an open issue is whether clicking "yes" or "agree", etc. on ones computer in response to an offer directed either to the offeree or to the offeree or to the public in general is sufficient to constitute acceptance under the UCC.

common law mirror image vs UCC

common law requires no provisions to an offer that is accepted and acceptance must be positive and unequivocal. the UCC is more lenient

faxed offers and acceptances

courts generally have held signatures on faxed offers and acceptances to be legally binding, unless the offer specifically requires an original signature

requirements of acceptance

definition and mirror image rule (Acceptance cannot deviate from terms of offer)

3 requirements of an offer

definition, communication, intent, definiteness

intent

determined by an objective standard of what a reasonable offeree would have believed

electronic contract formations

faxed offers and acceptance, click on acceptances

irrevocable offer of Unilateral contract

may not be revoked for a reasonable time after performance has begun

definiteness

offers terms must be clear enough to provide a court with a basis for giving an appropriate remedy

Requirements of an acceptance

positive, Unequivocal, communicated and made by the offeree

battle of the forms

the code focuses upon the intent of the parties

mailbox rule does not extend

to make faxed acceptances effective when sent if the fax was not received by the offeror

two issues in determining the viablity of faxed offers and acceptances tht are not received by sendee

whether the failure to receive was the sendee's fault and if it is then whether the failure would have occurred had the sendee exercised due diligence

Agreement

A meeting of two or more minds in regard to the terms of a contract

Offer

A promise or commitment to perform or refrain from performing some specified future act made by the offeror

Counteroffer

A rejection by the offeree of the original offer, coupled w a new offer made by the original offeree to the original offeror

3 exceptions for acceptance by silence

Acts consistent with acceptance, prior dealing, unilateral contract

What are transactions tht are not offers

Expressions of opinion, preliminary negotiations, auctions and other invitations to bid, negotiate, and/or contract including most forms of advertisement; and agreements to agree to one or more material contract terms or conditions at some later day

Examples of irrevocable offers

Firm offers, option contracts, offers on which the offeree has justifiability relied to her detriment " promissory estoppel", irrevocable offer of unilateral contract, statutory irrevocability

Acceptance by silence

Generally speaking, silence (or inactive) cannot constitute acceptance - even when the offeror indicates that silence or inaction will be taken as acceptance.

Acts consistent with acceptance

If the offeree, despite having an opportunity to reject, takes the benefit of offered goods or services, he or she is implied to have accepted the goods or services and agreed to compensate the offeror according to the terms of the offer

Prior dealings

If the offeror and offeree have prior dealings, pursuant to certain standards terms and conditions, the offeree has the duty to reject or risk being bound by his or her silence

How can a rejection be effective

Must be received by the offeror prior to any contrary writing or conduct evidencing acceptance by the offeree

2 steps of an agreement

Offer and acceptance

Mirror image rule

Prior to the adoption of the UCC, an offeree's acceptance was required to match the offeror's offer exactly. If the offeree's acceptance MATERIALLY changed, added to, or deleted any terms In the original offer, the offeree's acts were deemed to constitute a counteroffer NOT AN ACCEPTANCE

Acceptance

Voluntary act by offeree - either in the form of words or of conduct - that indicates agreement to the terms of the offer

firm offer

a merchants irrevokable offer to sell or buy goods in a signed writing that ensures that the offer will not be terminated for up to three months

Revocation

an offer may be terminated at any time before it is accepted subject to a few exceptions