Offer and Acceptance Flashcards

1
Q

Acceptance of Offer

A

1) Any reasonable manner under the circumstances
2) Prompt shipment accepted by promise to ship or shipping goods, even non conforming
3) Acceptance must be unequivocal
- CL uses mirror image rule
- UCC applies battle of forms
4) Effective when mailed (mailbox rule)

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2
Q

What is UCC 2-207 battle of the forms?

A

Applies ONLY when additional terms (not conditional acceptance).

Non-merchants - contract formed, new terms NOT part of the K.

BOTH merchants - contract formed WITH additional terms UNLESS:

  1. material change
  2. objected to within reasonable time
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3
Q

Unilateral Mistake

A

Where only one of the parties is mistaken about facts relating to the agreement. Generally, courts have been reluctant to allow a party to avoid contract for a mistake that was not shared by the other party.

*Exception: “Obvious” Mistake - If the other party to the contract knows or should have known of the mistake, courts grant relief to the mistaken party.

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4
Q

What needs to be included in an offer?

A

NO vague terms like “reasonable, fair, appropriate.
CL - price, who can accept and description of offer.
UCC - quantity and who can accept.

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5
Q

What should be included in a real estate K?

A

Must include parties to the K, description of the land, and price

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6
Q

What is a UCC Firm offer?

A

Cannot be revoked for 3 MONTHS if:

  1. K for the sale of goods
  2. SIGNED and WRITTEN promise to keep offer open
  3. Promise is made by a merchant

This ONLY applies to buying or selling goods.
NO CONSIDERATION is necessary.

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7
Q

In a unilateral K, is the offeree bound to complete?

A

NO

The offeror must keep the offer open for a reasonable amount of time once performance has begun. Mere preparation is NOT the start of performance.

However, offeree has no obligation to complete.

Acceptance ONLY occurs after full performance.

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8
Q

What happens if the offeree makes a counteroffer?

A

The offer is dead.

EXCEPTION: In an option K, even after counteroffer, can still accept original offer.

Note: A mere inquiry as to what the offeror will accept is NOT a counteroffer and does not kill the offer.

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9
Q

What happens when acceptance with additional terms?

A

CL: Mirror Image Rule. Makes it a counteroffer.

UCC: 2-207 Battle of the Forms. K is formed, new terms NOT included (unless both merchants).

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10
Q

What If: Sale of goods, BOTH merchant, offeree accepts and adds terms that make a material alteration?

A

Have K under terms of ORIGINAL OFFER

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11
Q

What if: Sale of goods, BOTH merchants, offeree makes acceptance CONDITIONAL on that term being included?

A

NO K. It is a counteroffer.

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12
Q

What if: Sale of goods, BOTH merchants, acceptance with additional non-material changes?

A

K formed with new terms, UNLESS offeror objects within reasonable amount of time.

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13
Q

What is a material change to the offer?

A

Substantially affects economic RISKS, BENEFITS, or changes REMEDIES for breach.

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14
Q

Exceptions to Mailbox Rule

A
  1. Offer stipulates that acceptance ONLY when received.
  2. Option K: must receive by deadline.
  3. Rejection mailed first, then letter of acceptance sent - Rejection is received first = Acceptance operates as counteroffer
  4. Acceptance mailed first, then rejection sent - Rejection is received first. If offeror relied on letter of rejection before the acceptance = estoppel MAY apply
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15
Q

What if order placed and seller just sends the wrong goods?

A

Contract and breach.

EXCEPTION: Accommodation
If seller acknowledges that he is sending the wrong item and asks can you accept this instead, then NO K - It is a counteroffer and NO BREACH.

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16
Q

Advertisements as offers?

A
  • Generally mere invitation for offers

- Exception- if the ad is specific as to quantity and who can accept it can be offer.

17
Q

Auctions and Offers

A
  • The bid, not the auctioneer asking for bids, is the offer. Auctioneer just inviting offers
  • Without Reserve Auctions: Auctioneer is obligated to sell to high bidder. Auction is “with reserve” unless terms state otherwise
18
Q

Irrevocable Offers

A
  1. Option K’s with consideration
  2. Firm offer by merchant. Has to be a:
    a. K for sale of goods
    b. written promise to keep offer open
    c. offer made by a merchant
  3. If there has been reliance by offeree that is reasonably foreseeable
  4. Offer to enter Unilateral K once performance has begun
19
Q

If rejection is mailed when is it effective?

A

When received

20
Q

Deadline for accepting option K

A
  • You CANNOT use the mailbox rule to meet an option deadline.
  • Response needs to be received by date specified, unless specified in the K it’s ok to mail acceptance