6. Forming Contractual Relationships

Acceptance

An unqualified willingness to enter into a contract on the terms in the offer.

Consideration

The price paid for a promise.

Counteroffer

The rejection of one offer and proposal of a new one.

Gratuitous promise

A promise for which no consideration is given.

Invitation to treat

An expression of willingness to do business.

Lapse

The expiration of an offer after a specified or reasonable period.

Offer

A promise to enter a contract, on specified terms, as soon as it is accepted.

Offeree

The person to whom an offer is made.

Offeror

The person who makes an offer.

Option agreement

An agreement where, in exchange for payment, an offeror is obligated to keep an offer open for a specified time.

Pre-existing legal duty

A legal obligation that a person already owes.

Promissory estoppel

A doctrine whereby someone who relies on a gratuitous promise may be able to enforce it.

Rebuttable presumption

A legal presumption in favour of one party that the other side can seek to rebut or dislodge by leading evidence to the contrary.

Rejection

The refusal to accept an offer.

Revocation

The withdrawal of an offer.

Standard form contract

A “take it or leave it” contract, where the customer agrees to a standard set of terms that favours the other side.