Chapter 14

Question 1

Elements of an Offer

Answer 1

1) Intent to be bound
2) Definite and certain terms
3) Communication to the offeree

Question 2

Intent

Answer 2

the intended purpose or goal of an action, especially in a contract

Question 3

How are contracts interpreted?

Answer 3

Objectively

Question 4

Objective Theory of Contracts

Answer 4

the intent to contract is judged by the reasonable person standard and not the subjective intent of the parties

Question 5

Auction with reserve

Answer 5

the seller is expressing intent to receive offers

Question 6

Auction without reserve

Answer 6

the seller is treated as making an offer to accept the highest bid and therefore must accept it

Question 7

Definite and certain terms

Answer 7

all the material terms must be included

Question 8

Material Terms

Answer 8

allows a court to determine damages in the event that one of the parties breaches the contract

Question 9

What is included in material terms?

Answer 9

subject matter, price, quantity, quality, and parties

Question 10

Communication

Answer 10

the offer must be communicated to the offeree, only the offeree can accept the offer

Question 11

How can an offer be terminated?

Answer 11

revocation, rejection, death or incapactiy, destruction, subsequent illegaility, lapse of time

Question 12

Revocation

Answer 12

the offeror can revoke the offer at any time unless the offeree entered into an option contract

Question 13

Rejection

Answer 13

the offeree can reject the offer

Question 14

Counteroffer

Answer 14

if the offeree offers a counteroffer, the original offer is terminated

Question 15

Illegality

Answer 15

if the subject matter of the offer becomes illegal, the offer immediately terminates

Question 15

Death/Incapacity

Answer 15

if the offeror becomes incapacitated or dies, the offer immediately terminates

Question 16

Lapse of time

Answer 16

the offer will expire after a reasonable amount of time, which depends on the subject matter of the offer

Question 17

Option contract

Answer 17

the offeree gives the offeror a piece of consideration in exchnage for holding the offer open for a specific amount of time

Question 18

Exceptions to Revocability

Answer 18

option contract, detrimental reliance

Question 19

Detrimental Reliance

Answer 19

if the offeree had reasonably relied on the promise to hold to offer open and had taken action in reliance on the offer, the courts may use promissory etoppel to prevent the offeror from revoking their offer

Question 20

Counteroffer

Answer 20

an offer made by an offeree that relates to the same matter as the original offer but proposes a substituted bargain that differs from the one proposed in the original offer

Question 21

What are the ways to manifest intent?

Answer 21

by performance or by a return promise

Question 22

Mirror image rule

Answer 22

the terms of the acceptance must mirror the terms of the offer

Question 23

Mailbox Rule

Answer 23

provides that an acceptance is valid when the offerer places it in the mailbox… not applicable when there is instantaneous communication (over the phone, in person, by telex)

Question 24

The Uniform Electronic Transactions Act

Answer 24

an offer is considered received via email when it enters the information processing system designated by the recipent