Offer and Acceptance Ch 10

What are the Essentials of an offer?

An offer gives the offeree the power to create a contract by acceptance. To constitute an offer three elements must be present: 1) communication 2) Intent 3) Definiteness

Rejection

An offeror revokes and an offeree rejects. NOT INTERCHANGABLE an offeree may aceept or reject. the offeree does not have to formally reject, can let lapse time. once rejection is received, the offer terminates.

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May be considered an offer where terms are clearly stated and all is required of offeree is specific action. Example: if you limit number of offerees it is a contract. First 5 at the store receive x for x

Rules of offer and acceptance

Offer, revocation, rejection, and counteroffer are effective upon receipt Acceptance is effective upon dispatch. this is true unless offer specifically states otherwise, the offeree responds by some unauthorized means (receive by this time, this date, this method), or If rejection sent first and acceptance after, acceptance is no longer effective upon distpatch, but rather only upon receipt, and only if received prior to the rejection.

Offers made in Jest

Where the offeror claims to have been joking. if a hypothetical reasonable prudent person would believe that the offeror was serious then is an offer

Lapse of time

a contract offer will remain open for a reasonable time unless a specified time is stated. where an offer provides that it will be held open for a specific period of time, the general rule is that the period begins to run on the day the offeree receives it

Acceptance of offer

acceptance of an offer is necessary to create a contract and marks the moment the contract is formed

requirement contract

agreement of a seller to supply a buyer with all of the buyers requirements for certain goods. The code, or UCC, is general terms of output as long as it is in good faith. Common law is exact quantity.

Definiteness

although a statement intended to be an offer under the common law need not cover all possibilities, it must be sufficiently clear on the main terms of subject matter of the contract price quantity quality terms of payment duration *UCC just quantity*

Revocation

an action done by the offeror. Offeror is permitted to revoke an ordinary offer at any time prior to its acceptance by the offeree

Output Contract

an agreement of the buyer to purchase a seller's entire output

Duration of offers

an offer will stay open until it is either accepted, or until one of the following occurrences terminates lapse of time revocation rejection counteroffer death or incompetence of the offeror/offeree destruction of the subject matter to which the offer relates illegality of contract type

Authorized an unathorized means

authorized - any reasonable means to communicate unless the offer stipulates otherwise. If in unauthorized means of communication of an acceptance is received within the same time period it would take to communicate by an authorized means, the authorized means of acceptance is effective upon dispatch

statutory irreconcilability

bid to government that must be open for 30 days

late of defective acceptances

does not create contract

firm offers under the code-

has to be made by merchant, in writing, signed by merchant, has to have assurance of time to aceept offer, if no time listed then reasonable time where longest is 3 months '

Subsequent illegailty

if the performance or subject matter of an offer becomes illegal after the offer is made, but before it is accepted, the offer is terminated

With Reserve

law persumes that the auction is with reserve unless states otherwise. this gives owner the right to pull product off the auction block if price insufficient.

Promises made under extreme conditions

offers made under extreme conditions (like saving ones life) courts do not hold that the victim actually had the intent to make an offer.

Exceptions to general rule of recovation

option contracts, firm offers under the code, statutory irreconcilability, and irrevocable offers of unilateral contracts

stipulated provisions in the offer

sometimes an offer may specify the method of communication that is to be used. in such case, acceptance must be by the specified method in order to be valid

Death of incompetency

terminates offer because a dead person or incompetent person cannot leagally accept offer or enter into a contract; However, optioin offer can be accepted by estate

Destruction of specific subject matter

terminates offer. Example- a car which has been stolen and stripped after an offer was made cannot be sold under orginial offer

counteroffer

terminates the original offer, but a mere inquiry does not

without reserve

the auctioneer may only withdraw goods put up for for bid if no bid is made within a reasonable time

Intent

the courts apply the objective standard for intent. to have legal effect an offer must show intent to enter into a contract. terms do no have to be specific; thus, ads price tags and auctions are not an intentional offer but an invite to make an offer.

irrevocable offers of unilateral contracts-

the offer may not be recoked for a reasonble time once the offeree has begun preformance

Communication

the offeree must know about the offer in order to accept it, and it must be made or authorized by the offeror

Silence as acceptance

usually an offeree's silence will not constitute acceptance. Silience can constitute an acceptance where the parties have agreed to such or where the parties past pattern of behavior has indicated that silence would constitute as an acceptance

option contract

you got something from them to keep the offer