Offer Flashcards
Define Offer
Offer
Memorize
An offer is a manifestation of present contractual intent, communicated to an identified offeree, containing definite and certain terms.
What is High/Low?
Present Contractual Intent - Offer
Memorize
Statements that contain the lowest price a person would sell or the highest price a person would pay are not offers to sell or buy, respectively, at the stated price
Are jokes offers?
Present Contractual Intent - Offer
Memorize
If an offer is made in jest, and the offeree knows or should have known that the offer is a joke, then the offer is invalid.
Power of Acceptance - Essay Statement
Present Contractual Intent - Offer
Memorize
Here, a reasonable person would believe that all he needs to say is ‘I accept” and a contract will be formed.
Are Advertisement’s, Catalogues, and Quotes Offers?
Present Contractual Intent - Offer
Memorize
The general rule is that advertisements (e.g. newspaper ads, handbills, fliers, etc.) are not considered offers but are invitations to receive offers.
Are Inquiries, Bids and Preliminary Negotiations Offers?
Present Contractual Intent - Offer
Memorize
Inquiries, bids and preliminary negotiations are not offers because they lack present contractual intent.
What happens in a Public Offer?
Communicated to an Identified Offeree
Memorize
In a public offer, identification of the offeree and acceptance occur at the same time after 1) someone knows of the offer 2) is motivated by it, and 3) accepts the offer by performing the requested act.
What are the Offer requirements under the UCC?
Containing Definite and Certain Terms
Memorize
Under the UCC, the offer need only state the subject matter and quantity.
What terms do not need to be in included in an Offer under the UCC?
Containing Definite and Certain Terms
Memorize
A contract under the UCC, as long as there is contractual intent by the parties, need not contain terms including the 1) price 2) time and place of delivery, and 3) time of payment.
What are the Offer Requirements under the Common Law?
Containing Definite and Certain Terms
Memorize
Under the common law, the offer must state the 1) quantity 2) time for performance 3) interested parties 4) price, and 5) subject matter.
What are the Offer Requirements for the Sale of Land under the Common Law?
Containing Definite and Certain Terms
Memorize
Under the common law, offers involving real estate require a description of the real property with adequate certainty to identify the land and price.
Define Revocation
Termination of Offer by Offeror - Revocation
Termination of Offer - Offer
Memorize
A revocation occurs when the offeror communicates to the offeree that the offeror no longer wishes to be bound by the offer.
Define Indirect Revocation
Termination of Offer by Offeror - Revocation
Termination of Offer - Offer
Memorize
If an offeree receives correct information, from a reliable source, that the offeror no longer wants to be bound by the offer, then the offer is revoked.
How do you properly revoke a Public Offer?
Termination of Offer by Offeror
Memorize
Revocation of offers to the public may only be revoked by notification to the public by the same or better means in which the offer was communicated.
List Irrevocable Offers
Termination of Offer by Offeror
Memorize
The general rule is that all offers are freely revocable unless one of the four exceptions apply:
- Option contract: An offer supported by consideration is irrevocable. If the option does not specify a time, then the option will remain open for a reasonable time.
- Merchant’s firm offer: A writing signed by a merchant which gives assurance that the offer will be held open is not revocable, for lack of consideration, during the time stated (or) if no time is stated, then for a reasonable time not to exceed 3 months.
- Detrimental reliance: If an offeree detrimentally relies on an offer, and that reliance is reasonable, foreseeable and substantial, then the offer must stay open for a reasonable time.
- Unilateral contract once performance has begun: An offer for a unilateral contract is not revocable once performance has begun.
Termination of Offer by Reasonable Time?
(Not Face-to-Face)
Termination of Offer
Memorize
An offer will terminate after a reasonable time based on market conditions, the nature of the subject matter, trade custom or usage, etc.
Termination of Offer by Lapse of Time (Face-to-Face)?
Termination of Offer
Memorize
In face-to-face negotiations, unless there are words to the contrary, the offer will terminate when the parties have left each other’s presence.
Termination of Offer by Death or Incapacity?
Termination of Offer
Memorize
Death will terminate an offer at the time of death.
Incapacity will terminate an offer at the time the other party learns of the incapacity.
Termination of Offer by Destruction of Subject Matter?
Termination of Offer
Memorize
Destruction of subject matter will terminate an offer.
Termination of Offer by Supervening Illegality?
What is Supervening Illegality?
Termination of Offer
Memorize
If at the time of offer the subject and purpose is legal, but then subsequently becomes illegal, the offer will terminate.
Define Rejection
Termination of Offer by Offeree
Memorize
A rejection occurs when the offeree communicates to the offeror that the offeree is not interested in the offer.
Is a Comment on Price a rejection?
Termination of Offer by Offeree - Rejection
Memorize
A mere comment on price does not constitute a rejection.
Does Rejection of an Option Contract terminate the offer?
Termination of Offer by Offeree - Rejection
Memorize
Under an option contract, if the offeree communicates to the offeror that the offeree is not
interested in the offer, the offer is not terminated.
What does a Counter-Offer do?
Termination of Offer by Offeree - Rejection
Memorize
A counter-offer acts as a rejection.
Does the UCC Apply?
Essay Formatting - UCC
Memorize
The UCC applies where the subject matter is goods. Goods are moveable, tangible property.
Merchants?
Essay Formatting - UCC
Memorize
A merchant is one who deals in goods of the kind or by their occupation has some special skill or knowledge about these goods.
What Law Governs?
Essay Formatting - Common Law
Memorize
Common law governs where the subject matter is services.
Party v. Party
Essay Formatting - UCC/Common Law
Memorize
For Party to have any contractual rights, we will look to see if there is a valid enforceable contract between Party and Party.
Define Valid Enforceable Contract
Essay Formatting - UCC/Common Law
Memorize
A valid enforceable contract consists of an offer, acceptance, consideration, and lack of formation defenses.
Why are advertisements not considered offers?
Advertisements are generally not considered offers because they lack commitment on the part of the offeror.
Are there any exceptions to an advertisement not being an offer?
Yes, if the item contains all material terms of the offer and identifies the offeree, such as “first-come-first-served” or “first five customers”, this is sufficient to take the advertisement out of the general rule and will constitute an offer.
Other than statements like “first-come-first served”, is there any other situation where an advertisement may be considered an offer?
Yes, if the person solicits a price and receives a response that would not normally be an offer (catalogue, advertisement, etc.), this is sufficient to take the advertisement out of the general rule and will constitute an offer.
Within revocation, is the general rule that all offers are freely revocable up to the time of acceptance?
Yes, the general rule is that all offers are freely revocable up to the time of acceptance.
Within Indirect Revocation, are offers to third parties or rumors sufficient?
No, offers to third parties and rumors are not sufficient to indirectly revoke an offer.
Once performance has begun, is a unilateral contract revocable?
No, a unilateral contract is not revocable once performance has begun.
In a unilateral contract, once performance has begun, must the offeror allow the offeree a reasonable time to complete performance?
Yes, the offeror must allow the offer a reasonable time to complete performance once performance has begun.
In a unilateral contract, is preparation for performance considered performance?
No, preparation for performance is not considered performance.
Under an option contract, if no time is specified, how long must the option remain open for?
A reasonable time
Under a merchant’s firm offer, if no time is specified, how long must the offer remain open for?
A reasonable time not to exceed three months.
So, of all irrevocable offers, a merchant’s firm offer is the only irrevocable offer that specifies a time limit of three months?
Yes
Within a merchant’s firm offer, after three months without acceptance, does the offer terminate?
No, the offer simply becomes revocable.
Within detrimental reliance, how long must an offer detrimentally relied upon by an offeree remain open?
For a reasonable time
Detrimental reliance must be what three things?
RFS - Reasonable, Foreseeable and Substantial.
Within face-to-face termination of offer, unless there are words to the contrary, the offer will terminate when the parties have left each others presence. What about the telephone?
Yes, the ending of a telephone conversation or other means of “substantially instantaneous communication” is the same as two parties leaving each others presence.
Can option contracts be terminated by death or incapacity?
No, option contracts cannot be terminated by death or incapacity.
How may relief (if any) be sought under Supervening Illegality?
By quasi-contract or restitution.
What is a quasi-contract?
A fictitious contract created by the courts.
Under an option contract, does rejection terminate the offer?
No, a rejection cannot terminate an offer held open by consideration,.
Is there any recourse for an offeror in an option contract when the offeree has rejected the offer and the offer cannot be revoked?
Yes, if the offeror detrimentally relies upon the rejection, the offeror may raise estoppel as a defense to enforcement.
For terms that do not need to be in included in an Offer under the UCC, are there any special conditions with regard to price?
Yes, price is not required under the UCC as long as the price was not discussed during the offer. If price was discussed and could not be agreed upon, there is no contract until the price is agreed.
