Offer Flashcards
What is required to form an offer?
A person makes an offer when a person communicates to another a statement of “willingness to enter into a bargain” so that the other understands “his assent to the bargain is invited and will conclude it”.
What terms are required in the offer ?
The terms of the offer needs to be reasonably certain.
Common law - essential terms must be specified parties, subject, quantity and price.
UCC- Price not required. - Parties, subject and quantity.
Advertisements
Invitation to deal rather than an offer. Ad usually fails to convert a power of acceptance to the other side.
However, ads that are very specific and leave nothing open to negotiation may constitute offers.
Compare Counter offer
Under Common Law- Under common law, a statement is a counteroffer, rather than an acceptance , when the terms of the initial are changed. - eg when a condition is added to the purported counteroffer.
Promise to hold offer open
Generally, an offer may be revoked before the acceptance. A promise to hold an offer open requires consideration in order to be binding.
Def Mirror image rule
Under common law, the terms in the acceptance must match the terms of the offer exactly, otherwise it is not an acceptance,it is a counteroffer.
Def Battle of the forms (UCC 2-207)
Under the UCC, the acceptance does not have to mirror the offer. It has to be definite, reasonable amount of time.
Ucc gap fillers (additional terms added after Offer in the UCC)
Additional terms will govern the contract if BOTH parties are MERCHANTS unless:
- The initial offer expressly limited acceptance to its tersm;
- The additional terms materially alter the deal OR
- the offeror object to the additional terms within a reasonable amount of time.
What is the knock out rule
Under the knock out rule, DIFFERENT TERMS in the original offer and acceptance knock each other out. UCC Gap fillers are then used to plug this gap.
The Knock out rule does not apply to additional terms added by the offeree.
