Formation Flashcards
Formation process (2)
Offer
- outward manifestation
- signal that acceptance will conclude deal
Acceptance
Multiple offers (2 cases)
Advertisements: NOT offers, just invitations
- exception: condition that defeats unlimited acceptance problem (first 10 customers only, first come first served, etc) ARE offers
Reward offers: $500 to return my dog ARE offersT
Multiple offers (2 cases)
Advertisements: NOT offers, just invitations
- exception: condition that defeats unlimited acceptance problem (first 10 customers only, first come first served, etc) ARE offers
Reward offers: $500 to return my dog ARE offersT
Termination of an offer (4 types)
Lapse
- after time stated, or after reasonable time
- face-to-face rule: lapses at end of conversation
Death or incapacity of either party
Revocation by offeror (any time any reason, barring exceptions)
- direct
- indirect: takes action inconsistent, offeree finds out by reliable source
Rejection by offeree
- outright
- counteroffers are rejection, unless “mere inquiry”
- mirror image rule: acceptance must mirror terms, variation is a counteroffer
Preventing revocation (3 ways and american rule)
American rule: can revoke EVEN IF specific time to accept was given
Option contract (with consideration)
Detrimental reliance on offer
Firm offer under UCC
- offer made by merchant, in signed writing
- expressly stating held open (up to 3 months)
Offer and acceptance - bilateral vs unilateral
bilateral: offer seeking acceptance by promise. both parties bound
Unilateral: offer seeking performance in return (i.e. reward). offeror not bound til performance complete, offeree never bound
- note: can’t revoke a unilateral once performance BEGINS (not mere prep)
Acceptance
Acceptance must mirror terms of offer and be COMMUNICATED
- no communication needed for unilateral - performance all that is needed
- acceptance by mail: effective on DISPATCH unless contract says otherwise
