Contracts - Acceptance
Common law and UCC rules where the offer is for a unilateral contract.
1) Acceptance requires complete performance of the requested acts. Compare: An offer calling for acceptance by promise or performance (schizophrenic offer) or an indifferent offer is accepted when performance has begun. 2) Notice of completion: Even after performance is completed, notice of completion may be necessary to make acceptance effective. 3)Performance that a reasonable person would believe is called for by the offer in light of the terms of he offer and the other apprent surrounding circumstances is required to accept an offer for a unilateral contract.
UCC Battle of the Forms. What the terms of an acceptance which changes the terms of the original offer?
1) Contract contains all the terms common to both offer and acceptance. 2) If the offeror or offeree are not both merchants, new or different terms from the acceptance are part of the contract only if the offeror agrees. 3) If parties are both merchants, new (i.e. additional) terms in the acceptance automatically become part of the contract unless 1) offer stated to the contrary, 2) terms are a material alteration, 3) offeror object within reasonable time. If the acceptance has different terms (i.e., conflicting with terms in the offer) there is a split of authority. Some states treat different terms just like additional terms. Others conclude that the conflicting terms in the offer and acceptance are both "knocked-out" and the gap is filled with UCC gap fillers.
When can an offer be accepted by silence?
1) If offeree suggests it as a method of acceptance 2) where there is a course of dealing between the parties that creates a duty on the part of the offeree to object if he doesn't accept.
UCC Rules for acceptance by performance for BILATERAL contracts (Indifferent and schizophrenic offers)
1) If performance has begun but completion of performance will take time, as where shipment will take time to reach buyer, offeree must give notice to offeror that performance has begun. 2) ANY performance accepts offer. Exception: Sending nonconforming goods is acceptance unless seller clearly indicates godos are sent merely as an accommodation to buyer, rather than as acceptance. This is a counter-offer.
When can an offer for bilateral contract be accepted by conduct.
1) if offer states that assent may be communicated through conduct. 2) where there is an unsolicited offer, the acceptance of the benefits of the unsolicited offer is conduct indicating assent to the offer.
How can the acceptance be communicated? (The How)
Acceptance must have been communicated by a proper method. If the method is improper, there is no acceptance, there is a counteroffer. If an offer clearly requires use of a particular method of acceptance, use of any other method is a counteroffer. If the offer suggests use of a specific method but does not require it, use of suggest method or different but reasonable method is still acceptance. use of unreasonable method = counteroffer. Reasonable means as quick and as reliable as suggested method. If no method is required or suggested, offer may be accepted by same method used to send offer or any other reasonable method (as quick and reliable as method use to send offer).
What does the acceptance have to contain? (The What)
Acceptance must meet the same requirement as offer . . . there must be an expression of commitment to the terms of the offer. Commitment is judged ont he objectively apparent facts. These include the circumstances and that language used.
UCC -> When is there a counter offer rather than acceptance?
Battle of the Forms Rule: A reply to an offer for sale or purchase of good which changes or adds to terms of the offer is an effective acceptance unless... Seller sends nonconforming goods and indicates this is being done as an accommodation to the buyer. (This is a counteroffer) There is no expression of acceptance ("I'm not interested in your proposal, but here's my proposal...") There are words of acceptance, but they are expressly conditioned on the original offeror agreeing to accept the new or different terms ("I accept your proposal, on condition that you agree to the following changes."
Exception to the Mailbox Rule
Five Exceptions 1) If the offer says it doesn't apply 2) if the offer suggests a method of communicating acceptance and a different but reasonable method is used. 3) If this is an offer pursuant to option contract 4) The offeree dispatches an acceptance, then sends a rejection. The acceptance is effective upon dispatch unless offeror receives the rejection first and acts in reliance of it. 5) The offeree sends a rejection first then sends an acceptance. The acceptance is effective upon receipt if it beats the rejection. If not, the acceptance is only a counter offer.
Mailbox Rule (The When)
If offeree communicates by a proper method, prepays delivery charges, and properly addresses acceptance - it is effective on dispatch (leaves offeree's possession and control)
Acceptance of a bilateral contract
Issues: What - Deals with committment. What does an acceptance have to contain? How - Deals with how the acceptance is communicated. When - Deals with when the acceptance is effective
Common law -> When is there a counter offer rather than acceptance?
Mirror Image Rule: The acceptance must be the mirror image of the offer. Any change or addition, no matter how trivial, means it is a counter offer.
Offeree notice requirement to offeror for Schizophrenic offers for bilateral k's (where the acceptance can be either by promise or performance).
Offeree must give notice of the beginning of the performance within a reasonable time if the offeror would not otherwise be aware of the beginning. If there is no such notice, the offer lapses.
