Counteroffers

Question 1

Mirror Image Rule

Answer 1

In the CL universe, the Mirror Image Rule governs. The terms of the acceptance must match the terms of the offer EXACTLY. If not, it is not an acceptance but a counteroffer.

A conditional acceptance is a counteroffer (“if,” “only if”).

Question 2

How does acceptance work under 2-207?
When does an offeree’s expression constitute acceptance under 2-207?

Answer 2

Under 2-207, a purported acceptance that does not match the terms of the offer exactly can still count as legal acceptance.

Expression = Acceptance (even if it has additional/different terms) if it is:
1. definite (substantively similar; handsaw v chainsaw)
2. seasonable (timely)
3. sent in a reasonable time

Question 3

Under 2-207, what happens to the additional term if there is acceptance despite the additional term?

Answer 3

The new term controls ONLY IF:

1. Both parties are merchants,
2. The initial offer did not expressly limit acceptance to its terms,
3. The new term does not materially alter the deal, AND
4. The offeror does not object within a reasonable time to the new term.

*It is very difficult for new terms in acceptance to govern the K.

Question 4

Under, 2-207, what happens to the different term if there is acceptance despite the different term?

Answer 4

Majority: Knock Out Rule applies and knocks out both of the different terms. The UCC’s gap-filling provisions will apply.

Minority: The initial offer controls the terms.

Question 5

2-207(3): Acceptance Based on Conduct

Answer 5

If offer and purported acceptance differ too much to create a contract but the parties act as if a K exists, then UCC allows for a contract to be recognized with the following terms:

• Only terms both parties’ writings agree upon
• Rest of the K’s terms are supplied by UCC default rules.

Question 6

How to deal with confirming memos with additional terms?

Answer 6

If there is early agreement + written confirmation with new terms, work through same analysis regarding additional terms in acceptance (both merchants, material alternation, etc.)

Question 7

When will 2-207 not apply?

Answer 7

An acceptance expressly conditioned on assent to different/additional terms is a counteroffer.