Chapter 14 - Agreement

What are the elements of an offer?

1. Serious intent by the offeror to be bound to an agreement. 2. Reasonably definite terms. 3. Communication to the offeree.

Is an invitation to negotiate or an expression of possible interest in an exchange an offer?

An invitation to negotiate or an expression of possible interest is not an offer, because it does not express any willingness to be bound by an acceptance.

What do courts look at when determining intent to enter into a contract?

Courts look at the person's objective manifestation of intent and does not try to interpret what the person may have been secretly thinking.

What are the limited circumstances where an ad can be treated as an offer?

If it appears from the wording that the store did, in fact, intend to make an offer, that is, the ad specifies a limited quantity and provides a specific means by which the offer can be accepted, then the court will treat the ad as an offer.

What is an offer presumed to be?

If nothing is stated to the contrary in the terms of the auction, an auction is presumed to be with reserve.

What is the first element of the offer?

Intent

If a store says that a can of soda is $5, is that an offer?

No, courts will interpret that as the intent of a store to invite readers of the advertisement to come and make an offer.

What do some states do to prevent "bait-and-switch" advertising that would appear as offers?

Some states have consumer protection laws requiring advertisers to state in their ads either that quantities of the item are limited to the first X number of people or that rain checks will be available if the item sells out.

What is the agreement made up of?

The agreement is made up: 1. The offer 2. an acceptance.

How do courts interpret the parties' words and actions?

The courts interpret the parties' words and actions the way a reasonable person would interpret them.

What if the first element of a contract?

The first element of a contract is the agreement.

When does the formation of the agreement begin?

The formation of the agreement begins when the party initiating the contract, called the offeror, makes an offer to another party, called the offeree.

What is the name of the party that receives the offer?

The offeree

What is the name of the party that initiates the contract?

The offeror

What does intent mean in regards to contracts?

The offeror must show intent to be bound by the offeree's acceptance.