Offer & Acceptance Flashcards
What is an offer in contract law?
A clear, definite proposal by one party to enter into an agreement on specific terms, which remains open until accepted, rejected, revoked, or expired
What are the 3 requirements for valid acceptance?
- Must mirror the offer’s terms exactly (mirror image rule)
- Must be communicated to the offeror
- Must occur while the offer is still open
What is consideration in a contract?
Something of value exchanged between parties, which must be sufficient, bargained for, and not based on past action
When is the intention to create legal relations presumed?
In commercial agreements (assumed legally binding) and social/domestic agreements (assumed not legally binding unless proven otherwise)
What are the three key characteristics of an offer?
1) Willingness to be bound
2) Certainty of terms
3) Requires only a “yes” to create a contract
What is an invitation to treat?
A preliminary communication that invites offers but does not create legal obligations (e.g., shop displays, advertisements)
How does an offer differ from an invitation to treat?
An offer, when accepted, forms a contract, whereas an invitation to treat is merely an invitation for offers
What are 4 types of invitations to treat?
- Auctions
- Automatic Vending Machines
- Timetables
- Tenders
What is negotiation?
Discussion between parties about the terms of a potential contract
What is acceptance in contract law?
Acceptance is the unambiguous expression of agreement to the terms of an offer, indicating the offeree’s intention to be bound by those terms, creating a legally enforceable agreement
What is the Mirror Image Rule?
The Mirror Image Rule states that acceptance must exactly match the terms of the offer. Any variation or counteroffer constitutes a rejection, not an acceptance
How does acceptance differ in unilateral contracts?
In unilateral contracts, acceptance occurs through the performance of a specified act, not through a return promise, and does not need to be explicitly communicated
What are the 4 additional considerations in acceptance?
- Mode of acceptance
- Timeliness
- Knowledge of the offer
- Revocation of the offer
What distinguishes acceptance from a counter-offer?
Acceptance signifies agreement to the original offer’s terms, while a counter-offer alters the terms, rejecting the original offer and proposing new terms
What is the “Last Shot Rule” in the Battle of the Forms?
The last party to communicate terms before performance is generally considered to have their terms prevail
What is the Postal Rule?
The Postal Rule states that acceptance is deemed complete when the offeree posts their acceptance, even if the offeror has not received it
What is the impact of the Postal Rule in modern contract law?
The Postal Rule has diminished in importance with the rise of electronic communication methods, which are generally subject to different rules of acceptance
What is the general rule for acceptance through instantaneous communication?
Acceptance through instantaneous communication (like email or phone) is considered complete when received by the offeror
What is acceptance by conduct?
Acceptance by conduct occurs when the offeree’s actions, rather than words, indicate acceptance, especially in unilateral contracts
What 5 ways can an offer be terminated?
- Withdrawal
- Rejection
- Lapse of time
- Occurrence of an event
- The death of the offeror
What is required for the withdrawal of an offer to be effective?
The withdrawal must be communicated to the offeree to be effective
