Is there a deal between the parties? Flashcards
Offer
- One party clearly manifested willingness
- to enter into contract
- in such a way that offeree reasonably knows of willingness
Does common law require a specified quantity in the offer?
Yes
Does UCC require a specified quantity in the offer?
No
What are three examples of invalid offers?
- Preliminary negotiations
- State of opinion/intention
- Solicitations or advertisements
When do preliminary negotiation become a contract?
Only after necessary material details have been agreed upon
Is an oral agreement for a future written contract an offer?
No, not if either party intends not to be bound in absence of fully executed written contract
When does a solicitation or advertisement become an offer?
Only when it is clear and leaves nothing for negotiation
What is an example of a solicitation/advertisement that is an offer?
Reward
Types of revocation (ways it can be revoked)
- Death/incapacity
- Unreasonable lapse of time
- Direct revocation
- Indirect revocation
If deadline is specified in the offer, when is offer revoked?
Offer terminated at specified time
If no deadline is specified in the offer, when is offer revoked?
Offer terminated after reasonable amount of time
Direct revocation
Offeree receives notice from offeror of intent to not enter into proposed contract
Indirect revocation
- Offeror takes definite action inconsistent with an intention to enter into proposed contract AND
- Offeree acquires reliable information to that effect
Option contract
Promisee gives consideration in return promisor’s power to revoke offer is limited
Option contract (in unilateral contract)
Automatically created when offeree begins performance
Option contract (in bilateral contract)
Offer is held open for specified time if consideration is given by offeree
Merchant’s firm offer
- Offer
- Signed promise to hold offer
- For stated time, never longer than 3 months
When is an offer irrevocable (four instances)?
- Option contract
- Merchant’s firm offer
- Detrimental reliance
- Partial performance
Detrimental reliance (offer)
- Offer which offeror should reasonably expect to induce offeree’s action or forbearance
- That does induce such action or forbearance
- Becomes binding as option contract when necessary to avoid injustice
In what type of offer does partial performance make the offer irrevocable?
Unilateral = when offeree begins performance, offer becomes irrevocable
What does rejection of offer do in common law?
Rejection terminates offer and power of acceptance
Can an offer be revived?
Yes, by offeror’s renewal of offer
Mirror image law (common law)
Unless acceptance is identical to offer, acceptance is considered a rejection
Examples of rejection by mirror image law
- Counteroffers
- Conditional acceptance
- Additional terms
Under UCC, what are additional/different terms in an acceptance, if acceptance is not expressly made conditional and at least one party is a non-merchant?
Operates as an acceptance, with the additional/different terms becoming proposals for addition
Under UCC, what are additional/different terms in an acceptance, if acceptance is not expressly made conditional and both parties are merchants?
Operates as an acceptance, with additional/different terms becoming part of the contract unless
- additional terms materially alter the offer
- notification of objection is given within reasonable time after receiving additional terms
Under UCC, what are additional/different terms in an acceptance, if acceptance is expressly made conditional on additional/different terms?
Conduct by both parties is sufficient to establish a contract but they are only bound to terms they agreed upon
If mode of acceptance is specified, how do you accept?
In manner specified
UCC modes of acceptance in shipment contracts (when not specified)
- Prompt promise to ship
2. Shipment of nonconforming or conforming goods
When do nonconforming goods not constitute acceptance?
Only when seller notifies buyer that shipment is offered only as accommodation to buyer
Under common law, what are the modes of acceptance?
- Promise
- Performance
- Silence
What does a promise as acceptance require?
Requires that offeree complete every act essential to making of the promise
What does performance as acceptance require?
Requires at least part of what offer requests be performed or tendered
In essence, what does performance as acceptance operate as?
Return promise
Mailbox rule
Acceptance is effective when sent, not when received
What the exceptions to mailbox rule?
- Option contract
- Unauthorized means
- Performance
When is acceptance valid in an option contract?
Upon receipt
When is acceptance valid by unauthorized means?
Upon receipt
When is acceptance valid by performance?
If offeror cannot reasonably become aware of acceptance by performance, acceptance is valid upon proven notice
In what three situations does silence operate as acceptance?
- Offeree takes benefit of offered services with reasonable opportunity to reject them and reason to know they were offered with expectation of compensation
- Where offeror has stated or given reason to understand that assent may be manifested by silence and offeree in remaining silent intends to accept
- Where it is reasonable for offeree to notify offeror if he does not intend to accept, because of previous dealing or otherwise
