Chapter 12 business Law

Requirements of offer

1. Offeror'd serious intention 2. Definiteness of terms 3. Communication

Mail box rule

Acceptance is effective on dispatch which means placed into the control of the us postal service or by a third party carrier such as FedEx or ups this means acceptance is effective before it is received by the offeror Exceptions: if acceptance is not properly dispatched by the offeree If offeror specifies that acceptance will not be effective until it is received if acceptance is sent after rejection whichever is received first is given effect

Termination of the offer

An offer may be terminated prior to acceptance by either: action if the parties, operational law Terminated offer cannot be accepted

Shrink wrap agreements

Contract terms are inside the box with the goods Party opening box agrees to terms by keeping merchandise May contain different terms that purchase/business overlook. -sold as it - inconvenient venues for disputes resolution -allows provider to access purchasers systems to conduct audits Little to no confidentiality of the purchasers information

1. Offeror's serious intention

Contracts are judged by what a REASONABLE PERSON in the OFFEREE's position would conclude about the offer. The parties intent to be bound by offer

Click on or click wrap agreements

Courts have concluded a binding contract can be formed by clicking on a box indicating I accept or I agree. Contract can be formed via website or software Law does no require parties read all terms

Digital signature

Digital signature similar tondigitized but once the document is signed it is locked to prevent tampering. Can check for tampering by auditing documents.

Disclaimers

Explain sellers liability or disclaimer of liability for certain uses of the goods

Acceptance of terms

Explains what constitutes an acceptance such as a box the buyer must check to accept

Silence

General rule: silence is not usually considered acceptance because the offeree should not be legally obligated to affirmatively reject an offer Exceptions: offeree indicates silence means agreement Offeree signs an agreement indicating continuing acceptance of delivery until further notification

Digitized signature

Graphical image of a handwritten signature Disney bc the image can be copied and pasted into other documents Easily forged

Subsequent illegality of the proposed contract

If the object of an offer becomes illegal prior to acceptance the offer is terminated This situation usually occurs when a statue is enacted that makes the object of the offer illegal

Counteroffer

If the offeree makes a counteroffer the original offer is rejected a new offer is presented to the original offer cannot be accepted. A new contract would be required.

Destruction of the subject matter

If the subject matter of the offer is destroyed period to acceptance the offer is terminated

Operation of Law

Lapse of Time Destruction of subject Matter Death of offeror or offeree Illegality

2. Definiteness of terms

Major terms must be stated with reasonable definiteness - identification of the parties - object or subject matter of the contract - consideration to be paid - time of payment, Delivery, or Performance An offer can require specific terms to make the contract definite A court can supply missing terms if the parties intent to form a contract but will not rewrite if intent is vague or uncertain

Rejection

Of the offer by the offeree: Rejection by the offeree by words or conduct terminated the offer Effective only when it is received by the offeror or offeror's agent

Revocation

Of the offer by the offeror Offers can be withdrawn anytime before the offeree accepts the offer. The offeror expressly states the offer is withdrawn The offeror sells the goods and the other party to take some other act that is inconsistent Offers made to the general public can be revoked in the same manner the offer was originally communicated.

Lapse of time

Offer terminated by law when the period of time specified in the offer has passed. If no time period for acceptance is specified the offer terminates at the end of a reasonable period of time.

Agreement

Offer+Acceptance

Silence is not acceptance except:

Offeree receives. Benefits had opportunity to reject and knew compensation excepted

3.communication

Offeree's knowledge of the offer: communicated directly by the offeror or use of agents

Not offers

Opinions Future intent Auctions Preliminary negotiations Advertisement Social invitation

Action of the Parties

Revocation Rejection Counteroffer

Displaying online offers

Sellers website should include hyperlink to page with full contract Contract should be in at least 12pt font Full disclosure Clear language

Dispute resolution

Specify how disputes are resolved such as arbitration or forum selection clauses

Payment

Specify how payment is made

Limitation of remedies

Specify remedies if goods are defective or contract is breached

Privacy policy

State how the seller will use information collected about the buyer

Return policy

State refund and return policies

Unequivocal acceptance

The acceptance must be clear and unambiguous. It must not contain any conditions or exceptions. The offeree must accept all terms known as the " minor image" rule

Death or incompetence of the offeror or offeree

The offer is terminated if the offeror dies or becomes incompetent prior to acceptance Offer does not pass to heirs Cannot accept after death even if party did not know the offeror died Exception for irrevocable offers

Acceptance

Voluntary act by the offeree that shows agreement to the terms of an offer Only offeree or agent can accept In commercial settings a contract can be binding even if minor discrepancies exist between the offer and acceptance