- •§ 1.Syn Synopsis to Chapter 1: preliminary definitions 4
- •§ 2.17 Effect of Delay in the Delivery of an Offer 268
- •§ 2.17 Effect of Delay in the Delivery of an Offer 268 § 1.1 The Main Purpose of Contract Law Is the Realization of Reasonable Expectations Induced by Promises
- •§ 1.2 Legal Obligation Defined
- •§ 1.3 N1 Definition of the Term ''Contract''
- •§ 1.4 Contracts of Adhesion
- •§ 1.5 Formal and Informal Contracts
- •§ 1.6 Voidable Contracts
- •§ 1.7 Void Contracts
- •§ 1.8 Unenforceable Contracts
- •§ 1.9 Agreement Defined
- •§ 1.10 ''Bargain'' as a Contractual Expression
- •§ 1.11 Offer Defined
- •§ 1.12 Simultaneous Expressions of Assent: Contracts Without Offer and Acceptance
- •§ 1.13 What Is a Promise?
- •§ 1.14 Promise and Warranty
- •§ 1.15 Expressions of Intention, Hope, Desire, or Opinion
- •§ 1.16 Letters of Intent
- •§ 1.17 Illusory Promises
- •§ 1.18 N1 Assumpsit: Implied Assumpsit, Indebitatus or General Assumpsit, Special Assumpsit
- •[A] Implied Assumpsit
- •[B] Indebitatus or General Assumpsit
- •[C] Special Assumpsit
- •§ 1.19 Express and Implied Contracts
- •§ 1.20 Contract and Quasi Contract Distinguished
- •[A] Quasi Contract as a Source of Primary Rights
- •[B] Quasi Contract as a Remedial Device for Unwinding Failed Agreements
- •§ 1.21 General Contract Law, The Uniform Commercial Code, and the United Nations Convention on Contracts for the International Sale of Goods. [a] General contract law and the Restatements
- •[B] The Uniform Commercial Code.
- •[C] The United Nations Convention
- •§ 1.22 The Uniform Commercial Code as a Source of Common Law
- •§ 1.23 Unilateral Contracts Distinguished From Bilateral
- •Supp. To § 1.1 The Main Purpose of Contract Law Is the Realization of Reasonable Expectations Induced by Promises
- •Supp. To § 1.2 Legal Obligation Defined
- •Supp. To § 1.3 Definition of the Term ''Contract''
- •Supp. To § 1.4 Contracts of Adhesion
- •Supp. To § 1.6 Voidable Contracts
- •Supp. To § 1.7 Void Contracts
- •Supp. To § 1.9 Agreement Defined
- •Supp. To § 1.11 Offer Defined
- •Supp. To § 1.13 What Is a Promise?
- •Supp. To § 1.14 Promise and Warranty
- •Supp. To § 1.15 Expressions of Intention, Hope, Desire, or Opinion
- •Supp. To § 1.16 Letters of Intent
- •Supp. To § 1.17 Illusory Promises
- •Supp. To § 1.18 Assumpsit: Implied Assumpsit, Indebitatus or General Assumpsit, Special Assumpsit
- •Supp. To § 1.19 Express and Implied Contracts
- •Supp. To § 1.20 Contract and Quasi Contract Distinguished
- •Supp. To § 1.22 The Uniform Commercial Code as a Source of Common Law
- •Supp. To § 1.23 Unilateral Contracts Distinguished From Bilateral
- •Part I formation of contracts topic a offer and acceptance chapter 2 offers; creation and duration of power of acceptance
- •§ 2.1 Preliminary Negotiation
- •§ 2.2 Preliminary Communications Compared to Offers-Interpretation
- •§ 2.3 Request for an Offer Is Not an Offer-Auctions and Solicited Offers
- •§ 2.4 N1 Offer by Publication or Advertisement
- •§ 2.5 Quotation of Prices; Estimates
- •§ 2.6 Authority or Instructions to an Agent
- •§ 2.7 N1 Offers at the Supermarket or Self-Service Shop
- •§ 2.8 Partial Agreements-Agreements to Agree and Agreements to Negotiate
- •§ 2.9 Formal Document Contemplated by the Parties
- •§ 2.10 What Constitutes a Written Contract-There May Be a Series of Communications
- •§ 2.11 Delivery of a Document as the Final Expression of Assent
- •§ 2.12 Printed Terms on Billheads, Letterheads, Receipts, Baggage Checks, etc.
- •§ 2.13 Intention to Affect Legal Relations-Social Engagements, Gentlemen's Agreements, Jests and Sham Agreements
- •§ 2.14 Duration of Power of Acceptance Created by an Offer
- •§ 2.15 Missed Deadlines in Option Contracts
- •§ 2.16 Reasonable Time for Acceptance
- •§ 2.17 Effect of Delay in the Delivery of an Offer
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- •§ 2.18 Offers Are Usually Revocable
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- •§ 2.19 Notice of Revocation Necessary
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- •§ 2.20 Revocation Otherwise Than by Direct Notice
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- •§ 2.21 Revocation of General Offer by Publication
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- •§ 2.22 Irrevocable Offers-Meaning of ''Irrevocable''
- •42 Of 174 documents
- •§ 2.23 Options Created by a Conditional Contract or Covenant
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- •§ 2.24 Contract to Keep an Offer Open
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- •§ 2.25 Effect of the Rule Against Enhancement of Damages
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- •§ 2.26 Offers Made Irrevocable by Statute and Public Policy
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- •§ 2.27 Deposits to Be Forfeited in Case of Revocation
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- •§ 2.28 Irrevocable Offers Under Seal
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- •§ 2.29 Revocation After Part Performance or Tender by the Offeree
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- •§ 2.30 Real Estate Brokerage and Other Agency Cases
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- •§ 2.31 N1 Effect of Action in Reliance That Is Not Part Performance
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- •§ 2.32 N1 Part Performance and the Indifferent Offer
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- •§ 2.33 When a Standing Offer of a Series of Separate Contracts Is Irrevocable
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- •§ 2.34 Effect of Death or Insanity on Power of Acceptance
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- •§ 3.2 In a Bargaining Transaction, Only the Offeree Has Power to Accept
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- •§ 3.3 Assignment of Power by an Option Holder-Irrevocable Offers
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- •§ 3.4 Motive With Which Offeree Renders Performance
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- •§ 3.5 Knowledge of Offer as a Pre-requisite to Acceptance
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- •§ 3.6 Knowledge of the Offer After Part Performance Already Rendered
- •Illustration 1
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- •§ 3.7 Acceptance ''Subject to Approval'' by a Third Party
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- •§ 3.8 Acceptance by Overt Act
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- •§ 3.9 Unilateral Contract-Acceptance by Beginning Requested Performance
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- •§ 3.10 Acceptance of a Published Offer of a Reward for Action or Contest Prize
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- •§ 3.11 When the Words ''I Accept Your Offer'' Would Be Ineffective
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- •§ 3.12 Acceptance by Forbearance From Action
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- •§ 3.13 When Notice of Acceptance Is Necessary
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- •§ 3.14 Notice as a Requisite of Guaranty and Letters of Credit
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- •§ 3.15 Notice as a Condition Distinguished From Notice as an Acceptance
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- •§ 3.16 Offer of a Promise, Requesting Non-promissory Action in Return
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- •§ 3.17 Offer of an ''Act'' for a Promise
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- •§ 3.18 Silence as a Mode of Acceptance
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- •§ 3.19 Can Offeror Make Silence Operate as Acceptance?
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- •§ 3.20 Belated or Conditional Acceptance Followed by Offeror's Silence
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- •§ 3.21 Silence Plus Additional Circumstances
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- •§ 3.22 Multiple Acceptances
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- •§ 3.23 Alternative Modes of Acceptance
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- •§ 3.24 Acceptance by Post
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- •§ 3.25 Acceptance by Telephone or Other Electronic Means
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- •§ 3.26 Withdrawal of a Letter of Acceptance From the Mails
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- •§ 3.27 Acceptance by Telegraph-When Operative
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- •§ 3.28 Acceptance Must Manifest Assent and Be Unconditional
- •107 Of 174 documents
- •§ 3.29 An Acceptance May Be Unconditional Even Though the Acceptor Makes a Conditional Promise
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- •§ 3.30 Acceptance Not Conditional, Even Though Grumbling or Accompanied by a Request or by a New Offer
- •109 Of 174 documents
- •§ 3.31 Subsequent Erroneous Interpretation Does Not Make an Acceptance Conditional
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- •§ 3.32 Attempts by the Offeree to Restate in the Acceptance the Terms of the Offer
- •111 Of 174 documents
- •§ 3.33 Attempts by the Offeree to State in the Acceptance the Legal Operation of the Agreement
- •112 Of 174 documents
- •§ 3.34 Mode of Acceptance Can Be Prescribed by the Offeror
- •113 Of 174 documents
- •§ 3.35 Counter-Offers and Their Effect
- •114 Of 174 documents
- •§ 3.36 Power to Accept an Offer Is Terminated by a Counter-Offer or Conditional Acceptance
- •115 Of 174 documents
- •§ 3.37 Conditional Acceptances and Counter-Offers Under the Uniform Commercial Code and the United Nations Convention
- •116 Of 174 documents
- •§ 3.38 A Counter-Offer or Rejection by One Who Has a ''Binding Option'' or an Irrevocable Offer Does Not Terminate the Power of Acceptance
- •117 Of 174 documents
- •§ 3.39 Power of Acceptance Not Terminated by a Counter-Offer if Either Offeror or Offeree So Prescribes
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- •§ 3.40 Inquiries and Separate Offers Distinguished From Counter-Offers
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- •§ 3.41 Effect of Rejection of an Offer
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- •§ 4.2 Time of Performance Indefinite-Promises of ''Permanent'' Employment-At Will Employment
- •152 Of 174 documents
- •§ 4.3 Indefiniteness of Price or Terms of Payment-Money as a Commodity
- •153 Of 174 documents
- •§ 4.4 Agreed Methods of Determining the Price or Amount
- •154 Of 174 documents
- •§ 4.5 N1 Reasonable Price-Quasi-Contractual Remedy After Performance
- •155 Of 174 documents
- •§ 4.6 Uncertainty of Subject Matter to Be Exchanged for Price; Requirements and Output Contracts
- •156 Of 174 documents
- •§ 4.7 Effect of Subsequent Verbal Clarification or Action by the Parties
- •157 Of 174 documents
- •§ 4.8 Subsequent Action May Create a Quasi Contract
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- •§ 4.9 Mistake-Difficulty and Complexity of the Subject
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- •§ 4.10 Mistake as to the Words Used, or as to the Meaning Given to Words and Expressions
- •160 Of 174 documents
- •§ 4.11 Mistake in Transmission of Messages
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- •§ 4.12 Objective and Subjective Theories
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- •§ 4.13 Mutual Assent-''Meeting of the Minds''
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- •§ 4.14 Auction Sales-Offers to Sell and to Buy
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§ 1.12 Simultaneous Expressions of Assent: Contracts Without Offer and Acceptance
It is quite possible for two persons to reach an agreement and to express that fact in words or other conduct, without going through the specific process of an offer made by one, followed by a separate and independent acceptance by the other. For example, the terms of an agreement between two persons, A and B, might be prepared in advance by a third person, C, and communicated by C in completed form to A and B. Thereupon, A and B stand in each other's presence and repeat in unison, ''We mutually agree in accordance with the terms prepared for us by C.'' This scenario is purely hypothetical, but something much like it sometimes occurs where C, a mediator, makes a proposal that is accepted by both A and B. In such a case, the party first assenting to the proposal can be deemed the offeror, and the second party the offeree. In this context, as in others, however, it frequently will be apparent that although mutual assent has been reached, no identifiable moment of conclusion of the contract can be reconstructed and no offeror or offeree identified.n1
The model of offer and acceptance does not describe all contract formation. There are certain large and well-defined classes of cases in which a promise is held to be a binding contract even though there has been no expression of assent by the promisee. Such are practically all the cases in which a promise is enforceable because of some ''past consideration'' that constituted the motivating reason for which the promise is made.n2 Also, contracts formed under the doctrine of ''promissory estoppel'' are not made by the process of offer and acceptance.n3
The Uniform Commercial Code provides in Section 2-204(2) that: ''An agreement sufficient to constitute a contract of sale may be found even though the moment of its making is uncertain.''n4 There are also many cases at common law, not governed by the Uniform Commercial Code, where it is clear that a contract has been formed, but the process of offer and acceptance-if there was one-cannot be reconstructed. This may be true in a bargaining contract where agreement is reached in bits and pieces.n5 It is frequently true in a contract inferred from the parties' conduct over a long period of time.n6 As to contracts formed by conduct, the Uniform Commercial Code is explicit. It provides in Section 2-204(1) that: ''A contract for the sale of goods may be made in any manner sufficient to show agreement, including conduct by both parties which recognizes the existence of the contract.''
In modern business transactions of large scale it frequently happens that the parties, often not just two, but a multiplicity of enterprises, negotiate a transaction with the understanding that the parties will not be bound until their agreement is finally and completely articulated in written documents that are signed and exchanged. The documents are drafted, usually by lawyers, and reviewed by all of the interested parties. The parties arrange to meet at a ''closing'' where the documents are signed more or less simultaneously and exchanged.n7 Such closings depart from the model of offer and acceptance. Similarly, a proposed contract may be drafted, each party signing one copy. Upon the simultaneous exchange of the documents, a contract may be formed without there being an identifiable offeror or offeree.n8
There are also contracts to which there is no assent to the terms of the contract. Through the use of a fiction, tortious acts of conversion are transmuted into contracts.n9 Also certain contracts are made without assent by operation of law as where a lease is renewed by a tenant's holding over.n10
Despite the existence of contracts for which no process of offer and acceptance has occurred, or for which the process cannot be reconstructed, it is doubtless true that most contracts are made by the acceptances of offers. Third party beneficiary contracts are an interesting group in this respect. In nearly all of the cases in which a third party beneficiary has an enforceable right, the beneficiary's own expression of assent is not a necessary factor in making the promise enforceable.n11 In these cases, the contract is made by two other parties (promisor and promisee); with respect to them the rules as to offer and acceptance are applicable.
Legal Topics:
For related research and practice materials, see the following legal topics:
Contracts LawFormationExecutionContracts LawSales of GoodsForm, Formation & ReadjustmentFormationOffer & AcceptanceContracts LawFormationOffersGeneral OverviewContracts LawFormationMeeting of MindsContracts LawFormationAcceptanceGeneral OverviewCommercial Law (UCC)Sales (Article 2)Form, Formation & ReadjustmentGeneral Overview
FOOTNOTES:
(n1)Footnote 1. 2 Formation of Contracts: A Study of the Common Core of Legal Systems 1586 (Rudolph Schlesinger ed. 1968).
(n2)Footnote 2. See Chapter 9, dealing with Past Consideration.
(n3)Footnote 3. See Chapter 8, dealing with Reliance on a Promise as Ground for Enforcement.
(n4)Footnote 4. Accord, Restatement of Contracts (Second) § 22(2).
(n5)Footnote 5. E.g., Metro-Goldwyn-Mayer, Inc. v. Scheider, 40 N.Y.2d 1069, 392 N.Y.S.2d 252, 360 N.E.2d 930 (1976) . Numerous cases of indefinite agreements which became binding contracts because of subsequent conduct or discussion are good illustrations of contracts without an identifiable process of offer and acceptance. See § 4.7 below. See also Restatement of Contracts (Second) § 22, comment b.
(n6)Footnote 6. E.g., Wilhoite v. Beck, 141 Ind.App. 543, 230 N.E.2d 616 (1967) , one of countless cases of an implied contract to pay for food and lodging, and Bourisk v. Amalfitano, 379 A.2d 149 (Me.1977) , one of the countless cases of an implied contract to pay for construction work done. Neither case seems to have involved an identifiable process of offer and acceptance.
(n7)Footnote 7. See 2 Formation of Contracts, note 1 supra at 1583-85.
(n8)Footnote 8.
Ga. - Whitley v. Patrick, 226 Ga. 87, 172 S.E.2d 692 (1970) .
Ky. - D.L. Walker & Co. v. Lewis, 267 Ky. 107, 101 S.W.2d 685 (1937) . The court said: ''Appellant contends that the paper in question was no more than an offer by appellee, and that there was no acceptance. Looking to the papers exhibited, it appears that while the names of both parties were not signed to either of the papers, they were exact duplicates written at the same time; one signed by appellant and one by appellee. A written agreement of which there are two copies, one signed by each of the parties, is binding on both to the same extent as if each party had signed on one paper. Duplicates are treated as originals, although one may be called 'original' and another 'copy.' 13 C.J. 304, § 126. We have frequently held exchange of telegrams, postcards, or letters to constitute a valid contract, if upon consideration together they evidenced a meeting of the minds.''
N.Y. - Besser v. K.L.T. Associates, 42 A.D.2d 725, 345 N.Y.S.2d 659 (1973) , aff'd, 34 N.Y.2d 687, 356 N.Y.S.2d 295, 312 N.E.2d 478 .
Ut.- Aspen Acres Association v. Seven Associates, Inc., 29 Utah 2d 303, 508 P.2d 1179 (1973) , where it was properly held that mere execution of the duplicates without an inquiry into the parties' other expressions of intent is insufficient to establish that a contract had been made.
(n9)Footnote 9. See § 3.8 below.
(n10)Footnote 10. See 2 Formation of Contracts, supra note 1, at 1587-89.
(n11)Footnote 11. See Chapter 41, Third Party Beneficiaries.
Occasionally a court, not realizing or not approving the development of third party beneficiary law, has discovered a fictitious ''privity'' between the promisor and the third party. In such cases the third party's ''assent'' may be long after the making of the promise.
See:
Mass. - Gardner v. Denison, 217 Mass. 492, 105 N.E. 359 (1914) .
N.Y. - Kessler v. Haile Motor Co., 127 Misc. 413, 217 N.Y.S. 182 (1926) .
Eng. -The Satanita, [1895] P. 255, [1897] A.C. 59; McCannell v. Mabee Maclaren Motors, Ltd., 36 B.C. 369 (1926).
See also:
2 Formation of Contracts, supra note 1, at 1590-91.