Business Law Ch 10

Offer Definition

Indication of willingness to enter into a contract

Offer requirements

Communication, Intent, Definiteness

Lapse of Time

Offer remains open for the time period specified, or if no time is specified, a reasonable period of time.

Revocation

An offer may be terminated at any time before it is accepted, exceptions: option contracts, firm offers, statutory irrevocability, promissory estoppel 

Option contracts

Contract that binds offeror to keep an offer open for a specified time. Consideration required

Firm Offer

A merchants irrecvocable offer to sell or buy goods in a signed writing that ensures that the offer will not be terminated for a specified amount of time (max 3 months)

Statutory Irrevocability

Offer made irrevocable by statute

Irrevocable offer of unilateral contracts

A unilateral offer may not be revoked for a reasonable time after performance is begun.

Promissory Estoppel

Non-contractual promise that binds the promisor because she should reasonably expect the promise will induce the promisee to reasonably act in reliance on it.

Rejection

Refusal to accept an offer terminates the power of acceptance.

Counteroffer

Counter proposal to an offer generally terminates the original offer.

Death of incompetency

Of either the offeror or the offeree terminates the offer

Destruction of subject matter

If the subject is destroyed, the offer is terminated

Subsequent illegality

If the subject of the contract becomes illegal, the offer is terminated.

Acceptance of an offer definition

Positive and unequivocal expression of a willingness to enter into a contract on the terms of an offer.

Mirror image rule

Except as modified by the code, an acceptance cannot deviate from the terms of the offer.

Communication of acceptance

Acceptance effective upon dispatch unless the offer specifically provides otherwise or the offeree uses an unauthorized means of communication. 

Silence as acceptance

Generally does not indicate acceptance of an offer (exceptions: when you enter into a subscription like Netflix, your silence is indication you want to continue paying for the service.)

Effective moment of acceptance

Upon dispatch of the acceptance (ex mail or text message)

Stipulated provisions in the offer

The communication of acceptance must conform to the specifications in the offer.

Authorized means

The restatement and the code provide that, unless the offer provides otherwise, acceptance is authorized to be in any reasonable manner (in 2025 carrier pigeon is not reasonable)

Unauthorized means

Acceptance effective when received, provided that it is received within the time within which the authorized means would have arrived.

Acceptance following a prior rejection

First communication received by the acceptor is effective.

Defective acceptance

Does not create a contract but serves as a new offer.

Variant acceptance

Common law and code