Formation

Question 1

Offer

Answer 1

Two requirements: An outward manifestation and; the signal that acceptance will conclude the deal

Question 2

Commercial advertisements

Answer 2

Advertisements addressed to multiple recipients are generally treated as invitations for offers rather than offers.

Exception: language an advertisement such as first come first serve or first 10 customers only constitute an offer

Question 3

Four ways to terminate the power of acceptance

Answer 3

Lapse of time

Death or incapacity of either party

Revocation by the offeror

Rejection by the offeree

Question 4

Lapse of time

Answer 4

Power of acceptance it’s terminates at this time stated in the offer

if none stated in the power of acceptance will terminate after reasonable time.

Question 5

Death or incapacity of either party

Answer 5

Supervening death or incapacity of either the offeror or offeree will terminate the power of acceptance with respect to the offer

Question 6

Revocation

Answer 6

The offer or is free to revoke an outstanding offer:

Prior to acceptance, and

And effectively communicated

Question 7

Indirect revocation

Answer 7

Where the offeree learns of the offeror’s intention to abandon the deal from a third-party

The offeror has taken definite action inconsistent with intent to enter the proposed contract and the offeree acquires reliable information of the inconsistent action

Question 8

Revocation of an offer to multiple offerees

Answer 8

Notice of revocation must be made in a manner that is the functional equivalent of that used in making the offer

Question 9

Three forms of rejection by the offeree

Answer 9

Out right rejection

Rejection via a counter offer

Rejection via nonconforming acceptance

Question 10

The mirror image rule

Answer 10

At common law acceptance must mirror the terms of the offer

Question 11

Option contract

Answer 11

Three requirements

First, and offer

Second a subsidiary promise to keep the offer open

Third, a consideration for keeping the promise open

Question 12

Construction contracts

Answer 12

Most courts will bind subcontractors to their bids with implied option contracts to protect general contractors

Question 13

UCC firm offer rule

Answer 13

A merchant can make a firm offer to buy or sell goods without consideration with three requirements being met:

First: the offer is made by merchant

Second: the offer is made in writing signed by the merchant

Third: the offer expressly states by its terms that it will be held open.

Question 14

Duration of firm offer

Answer 14

Firm offer becomes your revocable either for the period of time stated in the firm offer or for a reasonable time

Firm offer can be no more than three months unless The merchant creates a common-law option contract

Question 15

Unilateral contracts

Answer 15

Seek a return performance The offeror is bound only when the offeree completes performance

Question 16

A bilateral contract

Answer 16

A promise is exchanged for a promise

Question 17

Revocation of the unilateral contract

Answer 17

Under common law, the offer or was free to revoke the unilateral offer until performance was completed

Under the modern rule, minority of courts will impose an option contract once the offeree has begun performance and has gone beyond mere preparations

Question 18

Communicating acceptance

Answer 18

The acceptance must mirror the terms of the offer and

The acceptance must be communicated to the offeror

Question 19

Reasonable forms of acceptance

Answer 19

First: the means used by the offer or

Second: that means customarily used in similar transactions

Third: a means of communication equivalent in expeditiousness and reliability to the offer

Question 20

Acceptance by silence

Answer 20

Silence is generally not acceptance except:

First: where the offeree takes the benefit of the offers services with a reasonable opportunity to reject

Second: where the offer or has given the offeree reason to understand that acceptance may be communicated by silence

Third: previous dealings make it reasonable that the offeree should notify the offeror if he does not intend to

Question 21

The mailbox rule – acceptance by mail

Answer 21

Acceptance by mail is effective upon dispatch so long as properly posted with the correct address and postage. Here, the parties are bound even if lost in transmission.

Offers, revocations, rejections, counteroffers are only effective upon receipt

Question 22

A UCC seller can except the buyers offer to purchase goods in three ways

Answer 22

First: a promise to ship goods in conformity with the terms of the offer

Second: a prompt or current shipment of the goods in conformity with the terms of the offer.

Third: the seller can also accept the buyers offer by shipping nonconforming goods

Question 23

Accommodations

Answer 23

A shipment of nonconforming goods will not constitute acceptance if the seller notifies the buyer that the shipment is offered as an accommodation this is a counter offer

Question 24

The battle of the forms

Answer 24

An acceptance which contains terms that differ from the buyer’s order will be considered a nonconforming acceptance unless acceptance is expressly made conditional to the additional on assent to the new or different terms

Question 25

Additional or Different Terms - Transactions involving a consumer and a merchant

Answer 25

Here, the additional or different terms are construed as proposals for addition to the contract.

Question 26

Additional terms

Answer 26

Become part of the contract unless:

First: the offer expressly limits acceptance to the terms of the offer

Second: the offer or objects to the additional terms within a reasonable time after receiving notice

Third: the additional terms would materially alter the contract

Question 27

Materially alter - General definition/standard

Answer 27

Terms that would result in surprise or hardship if added without the express awareness of the party

Question 28

Written confirmations

Answer 28

Additional terms are automatically part of the contract unless they materially alter the contract or the receiving party objects within a reasonable time.

Confirmations that differ from the terms of the prior agreement are proposals for inclusion.