Page 5 Flashcards
Does the UCC demand that an offer specify time?
No, courts will imply a reasonable time if one is not specified
What does the UCC say about when payment is due?
Due at the time and place the buyer will receive the goods if not otherwise specified
What does UCC say about delivery?
Due at a reasonable time and should occur at the seller’s place of business
Why is an agreement to agree not considered indefinite?
Because of the implied promise to negotiate in good faith based on reasonably objective standards and fair market values
How can the law save ambiguous terms?
By using experts to decide what the language means
What is the subject matter when it comes to real estate?
The description of the land and the price
If contract language says a sufficient amount of land, is that enough?
No. That is ambiguous and it has to be clear and certain
What is the subject matter of employment or service contracts?
The term of employment measured by time or task
What is the majority rule for protecting employees when they start working, even if there wasn’t really a good offer?
Obligation for the contract to be employment at will
What does it mean that an offer has to be communicated?
The offeree has to know about the offer and must understand it
Is it okay for an offeree to learn about an offer in any way?
Yes
What is a crossing offer problem?
When both parties send letters to one another offering the same thing
What is an example of a crossing offer problem?
Offering to sell you my house for $100,000 and you offered to buy it for $100,000
What are the two different views about crossing offer problems?
- Classical view: no contract
- Modern view: contract is offer you complete performance with knowledge of offer
- Majority rule from Moye: crossing offers don’t form a contract because neither knows about the offer, so it isn’t communicated
What is required for a public offer?
The offeree must know about the offer before completing performance
If you return someone’s watch not knowing there was a reward for it, can you get the reward after?
No, because you have to know about an offer before completing performance
What does is it mean to have an identified offeree for an offer?
Offer can only be accepted by the identified offeree, and the offer is personal to that offeree
How does the identified offeree component of a public offer work?
When someone with knowledge of the offer performs it, they become the identified offeree
What is the majority rule to figure out how many identified offerees there are in an offer?
- look to the objective intention of the offeror
- ask what a reasonable person would think the offeror wanted
What is an option contract?
Consideration in exchange for a promise to keep the offer open
What is another way that an option contract can arise?
When an offeree begins to perform the act requested in a unilateral contract
If consideration is present in an option contract, what does that do to the offer?
Makes it irrevocable
How can you terminate an irrevocable offer?
- lapse of time
- death or destruction of person or thing essential for performance
- supervening legal prohibition of the proposed contract
- *** rejection, revocation,
How can you terminate an offer through conduct?
By doing an act that prevents performance
What are the two major ways that offers get terminated?
- offeror revokes
- offeree rejects
What are the ways that an offeree can reject an offer?
Words or conduct
If an offeree rejects an offer, can it be revived later?
No
What are the two major categories of rejection of an offer?
Express and implied
What is an express rejection of an offer?
Refusal by saying no or giving a counter offer
When is an express rejection of an offer effective?
When the offeror or his agent receives it
What do you need to be careful about with express rejections of offers?
Exams often have a back-and-forth communication involving a counteroffer that eventually comes back to the original terms, but remember that the offer is terminated and it never revives
If I offer to sell my car for $10,000 in a letter and you write back saying you’ll pay $7500, what has happened?
A counteroffer that has rejected the first offer, so the first offer will never revive
If I offer to sell you my car for $10,000 and you write back saying you’ll pay $7500, and I write back saying no, what has happened?
I have rejected your counteroffer
If I offer to sell my car for $10,000 and you write back saying you’ll pay $7500 and I write back and say no, and you write saying you’ll pay $10,000, has a contract been formed?
No because there has only been an offer and no acceptance
What is an implied rejection of an offer?
Happens by doing nothing and letting an offer lapse
What are the majority and minority views on when rejection of an offer is effective?
- Majority: when received, regardless of whether you read or know it
- Minority: on dispatch and never revives
What is a counteroffer?
An offeree’s response to your offer that shows a willingness to be bound, but on different terms
If you respond to an offer with just an inquiry, is that considered a counteroffer?
No, the original offer stays open
What is the exception to counteroffers?
Option holders have the right to make counteroffers during the option, and it doesn’t terminate the option unless the offeree reasonably relied to his detriment on the counteroffer
How do you revoke an offer?
When the offeror withdraws his offer so that it can’t be accepted anymore
What kind of offers are revocable?
All, with a few exceptions
What is express revocation of an offer?
Words or writing directly stating an offer is no longer open
What do public offers require in the way of a revocation?
The revocation must be published in the same manner or a comparable medium and it is sufficient even when a member of the public never learned of the revocation
If a city has an arsonist problem and they put a reward on the public TV, but the TV station burns down, so they use the radio to revoke the offer, is that okay?
Yes, so long as the radio is a comparable medium
Does the UCC demand that price be included in an offer?
No, parties can establish price later based on what is reasonable at the time of delivery
If an offer wasn’t to the public originally, can a revocation to the public count?
No
What are exceptions to revocation of an offer?
- Option contracts that have been detrimentally relied on
- Unilateral contracts where the offeree has begun to perform the requested act or detrimentally relied
- Statutes that preclude revocations
What are the old and modern rules for when a unilateral offer can be revoked?
- Old rule: can be revoked until offeree has completed performance
- New rule: until performance has begun unless it isn’t completed within a reasonable time
An offer for a unilateral contract includes what implied promise?
Implied promise to hold it open for a reasonable time. If the offeree makes an extensive beginning of performance before revocation and that beginning in reliance on the implied promise is what makes it irrevocable
