Chapter 1 - Contract Formation Flashcards
Offeror definition
The offeror is the person making the offer
Offeree defintion
The offeree is the person to whom an offer is being made
What are the 2 conditions of a valid offer ?
- It must be an outward manifestation of the offeror willingness to contract
- The offeror must show signal that acceptance would conclude the deal
Types of outward manifestation
Oral
In writing
Gesture
What are the situations where you have multiple offerees ?
- Commercial advertisement
- Self-Limiting rewards
- Open-field rewards
- Auctions
What particularity does have the commercial advertisement and what is the exception ?
According to the Common Law rule, commercial advertisement is considered as an invitation to offer unless the ad specifies a certain amount of goods
The 2 types of rewards and their definition
Self-limiting rewards : Task to be performed only once
Ex : bounties
Open-field rewards : Rewards offers which indicate the task to be performed, the task can potentially be performed by multiple parties
Ex : 50$ for anyone who run for 1 hour
Reward definition
Generally rewards are treated as offers bc they promise money in exchange for performance of a specific task.
What is an auction ? What are called the offer and the participants ?
Auction = invitation to offer
Offers = Responsive bids
People making offer = biding people
What does the offer create ?
The power of acceptance in the offeree
The 4 ways to determinate the power of acceptance
- Lapse of time
- Death or incapacity
- Revocation by offeror
- Rejection by offeree
What is reasonableness stop trade ? What would it be ?
It is a doctrine that determine what is the reasonable time when the offeror can revoke
- Subject matter and market conditions
- Degree of urgency and means of transmission
What is conversation ?
The face-to-face conversation rule allows an offer to lapse at the end of the conversation
Definition lapse of time
An offer lapses after the time stated in the offer is over or after a reasonable amount of time
Death or incapacity
Death or incapacity of either party terminate the power or acceptance
What are the requirements of the revocability of the offeror ? (3)
- The offer must be revoke before the acceptance of the offeree
- Revocation must be communicated to the offeree
- You need to revoke the offer the same way you announced it
Rejection by the offeree
If the offeree changed his mind after that, the offer is not open, the offeree rejected it himself
What are the three ways of the rejection by the offeree ? (3)
- Outward rejection
- Rejection by counter-offer
- Rejection by non-conforming acceptance (no mirroring)
What are the 2 requirements of an effective acceptance ?
- Acceptance must mirror the terms of the offer = mirror image rule
- Acceptance must be communicated to the offeror
What if offeror stipulates particular mean of accepting ?
It becomes the offeree’s mean of acceptance
How silence as a mean of communication can be reasonable ? (3)
- It must be the same way the offer was made
- If it’s a customarily way of communicating
- If the means of communication is equivalent in speed & in reliability to the mean used by offeror
What are the 3 exceptions to the requirements that acceptance must be communicated ?
- Acceptance by silence
- Unilateral contract
- Mailbox rule
Acceptance by silence (3)
- When the offeree takes the benefit of the offeror services with a reasonable opportunity to reject them with the reason to know that compensation was expected
- The offeror has given the offeree a reason to understand that acceptance may be communicated through silence
- Previous dealings
Unilateral contract
In its settings, acceptance is affected only by completing performance.
Communication typically is not required unless the offer provides otherwise
Mailbox rule
Common Law mailbox rule = acceptance by mail is effective upon dispatch so long as it’s properly posted
How can a seller accept a buyer offer ? (2)
With prompt shipment of the goods
By sending non-conforming goods if he doesn’t have the proper goods anymore
What is bargain theory ?
A promise is unenforceable unless supported by consideration.
The promise has some value and must be exchange for something else of value.
= Quid pro quo (consideration is quid pro quo/bargain for exchange)
The common problem occuring in Contract Law ?
Gratuitous promise : it is a promise to make a gift, this promise lacks of consideration, generally unenforceable = no quid pro quo
In gratuitous promise there is either what ?
- lacks of consideration
- want of consideration
- no consideration
- not supported by consideration
Failure of consideration
One of the party didn’t act according to the consideration of what was supposed to give
Promissory estoppel
It is a legal principle in which a promise is enforceable by law even if made without formal consideration = acceptance of consideration
Promissory estoppel case
When the promisor made a promise to the promisee and when this one relied on that promise to his detriment
4 requirements in order to have promissory estoppel
- A promise
- Forseeable reliance
- Actual reliance
- Injustice without enforcement
