- •§ 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
- •38 Of 174 documents
- •§ 2.19 Notice of Revocation Necessary
- •39 Of 174 documents
- •§ 2.20 Revocation Otherwise Than by Direct Notice
- •40 Of 174 documents
- •§ 2.21 Revocation of General Offer by Publication
- •41 Of 174 documents
- •§ 2.22 Irrevocable Offers-Meaning of ''Irrevocable''
- •42 Of 174 documents
- •§ 2.23 Options Created by a Conditional Contract or Covenant
- •43 Of 174 documents
- •§ 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
- •46 Of 174 documents
- •§ 2.27 Deposits to Be Forfeited in Case of Revocation
- •47 Of 174 documents
- •§ 2.28 Irrevocable Offers Under Seal
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- •§ 2.29 Revocation After Part Performance or Tender by the Offeree
- •49 Of 174 documents
- •§ 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
- •51 Of 174 documents
- •§ 2.32 N1 Part Performance and the Indifferent Offer
- •52 Of 174 documents
- •§ 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
- •81 Of 174 documents
- •§ 3.3 Assignment of Power by an Option Holder-Irrevocable Offers
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- •§ 3.4 Motive With Which Offeree Renders Performance
- •83 Of 174 documents
- •§ 3.5 Knowledge of Offer as a Pre-requisite to Acceptance
- •84 Of 174 documents
- •§ 3.6 Knowledge of the Offer After Part Performance Already Rendered
- •Illustration 1
- •85 Of 174 documents
- •§ 3.7 Acceptance ''Subject to Approval'' by a Third Party
- •86 Of 174 documents
- •§ 3.8 Acceptance by Overt Act
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- •§ 3.9 Unilateral Contract-Acceptance by Beginning Requested Performance
- •88 Of 174 documents
- •§ 3.10 Acceptance of a Published Offer of a Reward for Action or Contest Prize
- •89 Of 174 documents
- •§ 3.11 When the Words ''I Accept Your Offer'' Would Be Ineffective
- •90 Of 174 documents
- •§ 3.12 Acceptance by Forbearance From Action
- •91 Of 174 documents
- •§ 3.13 When Notice of Acceptance Is Necessary
- •92 Of 174 documents
- •§ 3.14 Notice as a Requisite of Guaranty and Letters of Credit
- •93 Of 174 documents
- •§ 3.15 Notice as a Condition Distinguished From Notice as an Acceptance
- •94 Of 174 documents
- •§ 3.16 Offer of a Promise, Requesting Non-promissory Action in Return
- •95 Of 174 documents
- •§ 3.17 Offer of an ''Act'' for a Promise
- •96 Of 174 documents
- •§ 3.18 Silence as a Mode of Acceptance
- •97 Of 174 documents
- •§ 3.19 Can Offeror Make Silence Operate as Acceptance?
- •98 Of 174 documents
- •§ 3.20 Belated or Conditional Acceptance Followed by Offeror's Silence
- •99 Of 174 documents
- •§ 3.21 Silence Plus Additional Circumstances
- •100 Of 174 documents
- •§ 3.22 Multiple Acceptances
- •101 Of 174 documents
- •§ 3.23 Alternative Modes of Acceptance
- •102 Of 174 documents
- •§ 3.24 Acceptance by Post
- •103 Of 174 documents
- •§ 3.25 Acceptance by Telephone or Other Electronic Means
- •104 Of 174 documents
- •§ 3.26 Withdrawal of a Letter of Acceptance From the Mails
- •105 Of 174 documents
- •§ 3.27 Acceptance by Telegraph-When Operative
- •106 Of 174 documents
- •§ 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
- •108 Of 174 documents
- •§ 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
- •110 Of 174 documents
- •§ 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
- •118 Of 174 documents
- •§ 3.40 Inquiries and Separate Offers Distinguished From Counter-Offers
- •119 Of 174 documents
- •§ 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
- •158 Of 174 documents
- •§ 4.9 Mistake-Difficulty and Complexity of the Subject
- •159 Of 174 documents
- •§ 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
- •161 Of 174 documents
- •§ 4.12 Objective and Subjective Theories
- •162 Of 174 documents
- •§ 4.13 Mutual Assent-''Meeting of the Minds''
- •163 Of 174 documents
- •§ 4.14 Auction Sales-Offers to Sell and to Buy
- •164 Of 174 documents
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Corbin on Contracts
Copyright 2007, Matthew Bender & Company, Inc., a member of the LexisNexis Group.
PART I FORMATION OF CONTRACTS
TOPIC A OFFER AND ACCEPTANCE
Supp. To CHAPTER 2 OFFERS: CREATION AND DURATION OF POWER OF ACCEPTANCE
1-2 Corbin on Contracts Supp. to § 2.19
Supp. to § 2.19 Notice of Revocation Necessary
[Go To Main]
(A) The following case cites this section:
(1) Inverworld, Ltd. v. United States, 2001-1 U.S. Tax Cas. P50350, 87 A.F.T.R.2d 1245, 2001 U.S. Dist. LEXIS 3087 (D.D.C. 2001) . Withdrawal of an offer is not effective unless it reaches the offeree prior to acceptance of the offer. The plaintiff's letter to the Department of Justice was not properly addressed and did not constitute a valid revocation of an offer of compromise.
(B) The following case cited the predecessor to this section:
(1) State of Ohio Bureau of Workers' Compensation v. Plumb, 2003 Ohio App. LEXIS 4779 (Ohio Ct. App. Oct. 6, 2003) . The plaintiff-employee received benefits and compensation from the Bureau of Workers' Compensation (''Bureau'') after sustaining bodily injuries in an accident involving a trucking company. The employee filed suit against the trucking company and the Bureau joined in the suit as a plaintiff, claiming subrogation rights. The employee proposed a settlement of the Bureau's subrogation rights by forwarding a check for $17,552.71 accompanied by a letter stating ''If this payment is acceptable please sign the enclosed entry [of dismissal] and forward it to'' the attorney for the trucking company. Sometime between June 25 and June 28, 2001, the Bureau's attorney signed the entry of dismissal and forwarded it to the trucking company's attorney. However, at 9 a.m. on June 27, 2001, the Supreme Court of Ohio filed a decision in a separate, unrelated case (Holeton) holding that it was unconstitutional for the Bureau to assert subrogation rights. In light of that decision, the employee stopped payment on the settlement check and notified the Bureau that the settlement offer was revoked. In the Bureau's action to enforce the settlement agreement, the trial court held for the Bureau on the footing that the employee's settlement offer required actual dismissal of the subrogation claim and not the mere promise of dismissal. On appeal, the instant court cited Corbin in support of the rule that an offeror may restrict or limit the offeree's power of acceptance as the offeror sees fit. Here, the employee's offer did not require actual dismissal. It required only signing and forwarding, both of which had occurred. A material question of fact, however, remained: when did the offeree complete the exercise of the power of acceptance? If he forwarded the signed document before 9 a.m. July 27, 2001, when the Holeton decision was filed, the contract was formed when the Bureau still had the right to subrogation which constituted consideration for the employee's promise. If, however, the signed document was not forwarded until after the Holeton decision was filed, there was no consideration to support the employee's promise since the Bureau would have no subrogation right to surrender. There would be no detriment to the promisee-Bureau and no benefit to the employee-promisor. Since the exact time of signing and mailing the letter was in dispute, a material issue of fact remained. The court reversed the judgment below and remanded the matter for further proceedings consistent with its opinion.
(2) American Anglian Environmental Technologies, L.P. v. Environmental Management Corporation, 2006 U.S. Dist. LEXIS 25959 (E.D. Mo. 2006) . The defendant made a settlement offer to the plaintiff who requested the defendant to clarify the terms of the offer. The defendant responded by modifying the terms of the offer. The plaintiff then accepted the original offer and not the modified version. The court relied upon Corbin in noting that where an offeror substantive alters the offer, the offer is revoked. Since the original offer no longer existed, the plaintiff had no power of acceptance. The plaintiff's motion to enforce a settlement based on the original offer was denied.
(3) Bascetta vs. Advantage Equipment Leasing, L.L.C., 2006 Wash. App. LEXIS 700 (2006) . Where a proposal stated a proposed lease transaction may or may not be ''approved'' and that the proposed lessee's deposit will either ''be applied'' or ''returned'' or ''retained,'' and the identity of the actual lessor was unclear, the proposal was nothing but an invitation for the proposed lessee to make an offer. Citing Corbin, the court explained that a purported offer that reserves the power to withdraw at will even after an acceptance is not an offer. It is an invitation to submit an offer.
(C) The following cases are noteworthy:
(1) CPI Builders, Inc. v. Impco Techs., Inc., 94 Cal. App. 4th 1167, 114 Cal. Rptr. 2d 851 (App. 2001) . A builder sued a technology company for breach of a construction contract. The lawyers for the parties discussed the possibility of binding arbitration and the builder's lawyer recommended arbitration to his client, who reluctantly agreed. The lawyer offered binding arbitration to defense counsel. Before the offer was accepted, the builder directed its counsel to revoke the offer but the offer was accepted before notification of revocation was communicated to the defendant's lawyer. The court recognized that, absent express authority, an attorney does not have implied plenary authority to enter into contracts on behalf of his client. In this case, however, the builder's lawyer had such express authority. The client's communication of revocation of that consent to her lawyer before the offer was accepted was ineffective since the revocation was not communicated to the offeree prior to acceptance.
(2) United States v. Donovan, 348 F.3d 509 (6th Cir. 2003) . The defendant faxed a withdrawal of its compromise offer of a tax dispute on an IRS form on April 18. On April 28, the IRS replied with a letter stating that the withdrawal was considered effective as of April 18. The IRS form, however, stated that the offer of compromise remained ''pending'' until the acknowledgment of the withdrawal by an authorized IRS official (which occurred on April 28) and that the statute of limitations was suspended while the offer was pending. The government filed this action for recovery of the tax in the amount of $466,936.21 on June 13, which would have been beyond the statute of limitations if the statute had begun to run again on April 18. The government argued that, under the unambiguous terms of the IRS form that evidenced the compromise offer, the suspension of the statute of limitations continued to apply while the offer was ''pending.'' If the statute had not resumed until April 28, it would not have expired until June 14. The district court granted the defendant's motion for summary judgment, but the instant court reversed. Recognizing that a withdrawal of an offer in compromise is effective like any other revocation of an offer when it is received by the offeree (Restatement (Second) of Contracts, § 42), the court accepted the government's distinction between the withdrawal of the offer and the IRS definition of when an offer ceases to be ''pending,'' i.e., only upon IRS acknowledgment of the withdrawal, which did not occur until the date of the IRS letter of April 28. Since the statute of limitations remained suspended while the offer was ''pending,'' it did not resume until April 28. The court remanded the case to the district court with instructions to enter summary judgment for the government.
[Editor's Note: On September 8, 2003, the IRS issued a revised revenue procedure (2003-71), which, in Section 7.02 (''Withdrawing and Offer to Compromise''), states that (1) if the taxpayer withdraws an offer to compromise by personal delivery, the offer will be considered withdrawn when written notification of the withdrawal is received by the Service; (2) if the taxpayer withdraws an offer to compromise by mailing written notification of the withdrawal via U.S. certified mail, the offer will be considered withdrawn on the date the Service receives the certified mail; and (3) in all other cases, including withdrawal by non-certified mail, fax, or phone, the offer will be considered withdrawn on the date the Service mails, or personally delivers, a written letter to the taxpayer acknowledging the withdrawal.]