Offer

Question 1

Offer (Rest.2nd of Contracts)

Answer 1

An offer is a manifestation of willingness to enter into a bargain, so made that the other person understands that their assent will seal the deal.

Question 2

UCC 2-204: Formation in general (Fairly Liberal Approach)

Answer 2

1. Any manner of agreement works–> a contract can be formed by words, writing or even conduct showing both sides acted like they had a deal.
2. Exact timing does not matter –> the contract exists even if you cannot pinpoint the exact moment it was formed.
3. Open terms do not kill the deal –> if the parties intended to contract and a court can supply a reasonable remedy; the contract is enforceable

Question 3

UCC vs. Common Law

Answer 3

Common law (Restatement)
UCC article (Sale of goods)

Question 4

Common Law (Restatement)

Answer 4

1. An offer exists if a reasonable person could with “yes” and form a contract immediately.
2. If important terms are vague/need clarification –> usually not an offer.
3. Courts emphasize certainty of terms (who, what, when, how much).

Question 5

UCC Article 2 (Sale of Goods)

Answer 5

Contract can be formed in any manner showing agreement (words, conduct, course of performance).

Exact timing of formation does not matter

Missing terms don’t prevent enforcement if parties intended to contract a remedy can be given.

Question 6

Lonergan v. Scolnick (Rmr: The act fast land sale - just an invitation- not an offer.)

Answer 6

Scolnick placed an ad to sell land. Lonergan responded, and Scolnick wrote back giving directions and saying Lonergan should “act fast” because another buyer might come along. Lonergan later tried to accept, but Scolnick had already sold the land to someone else.

Ads and preliminary letters are not offers if a reasonable person would know further assent from the offeror is needed before a contract is formed.

Question 7

Rest. 2nd of Contracts: Preliminary Negotiations

Answer 7

If the offeree knows (or should know) that the offeror doesn’t intend to be bound until giving further assent, then no offer exists. (Preliminary Negotiations don’t count. More is required)

Question 8

Leonard v. PepsiCo. Inc. ( The Harrier Jet Joke- ads are not offers)

Answer 8

A law student tried to claim a Harrier Jet from Pepsi’s commercial offering “7 million Pepsi Points,” but the jet wasn’t in the catalog, and the ad was tongue-in-cheek.

RULE: Ads are not offers unless they are clear, definite, and explicit; humorous or exaggerated ads (mere puffery) cannot reasonably be understood as binding offers.

Question 9

Rest. 2nd of Contracts: Ads

Answer 9

Ads are generally invitations to negotiate, not offers– unless they are clear, definite, explicit, and leave nothing open for negotiation.

Question 10

Offer Termination

Answer 10

1. Revocation
2. Rejection
3. Lapse
4. Death or incompetence of offeror

Question 11

Revocation

Answer 11

Retraction of an offer by the offeror.

Direct Revocation: Occurs if the offeror notifies the offeree that the offer has been revoked.

Indirect Revocation: Occurs if the offeree learns from a diff source that the offer has been revoked. The diff source must be reliable source, so that a reasonable person in the offeree’s position would know that the offer is no longer open. (Dickison v. Dodds)

Question 12

Dickison v. Dodds (Dodds sold early- no contract, offer revoked)

Answer 12

A seller promised to keep an offer to sell land open until Friday, but sold it to someone else on Thursday, and the buyer learned of this from his reliable agent before attempting to accept.

A promise to keep an offer open without consideration is not binding, and an offer is revoked once the offeree knows the offeror has taken inconsistent action (like selling to someone else), even without formal notice. (Indirect Revocation)

Question 13

Limitation on offeror’s power to revoke: Option Contract (Rest. 2nd of Contracts)

Answer 13

An offer is binding as an option contract if it is written, signed, recites consideration, to keep the offer open for a specified time.

Question 14

UCC 2-205 (Firm Offers)

Answer 14

(Unlike an Option Contract)

A merchant’s signed written promise giving assurance to keep an offer is enforceable without consideration, but it can’t last longer than 3 months.

If the “keep open” clause is snuck by the offeree, the offeror (merchant) must separately sign that specific clause for it to be binding.

Question 15

Tradtional v. Restatement v. UCC (Irrevocable Offers)

Answer 15

Traditional Rule –> Dickinson v. Dodds

Restatement

UCC

Question 16

Traditional Rule

Answer 16

Dickinson v. Dodds: Yes –> a promise to keep an offer is not binding without consideration

Question 17

Restatement (Option Contract)

Answer 17

No real consideration needed –> a written, signed offer that recites consideration and sets fair terms for a reasonable time is binding as an option contract.

Question 18

UCC 2-205 (Firm Offers)

Answer 18

No consideration needed –> a merchant’s signed promise to keep an offer is binding (max 3 months), with a special rule that if it is in the offeree’s form, the assurance must be separately signed. (Unless acceptance has occurred before revocation has.)

Question 19

Offer termination: Rejection

Answer 19

Express Rejection: An offer ends if rejected, and a counteroffer both rejects the original offer and creates a new offer.

Implied Rejection: A counteroffer rejects the original offer and simulatneously creates a new offer on diff terms.

Question 20

Offer Termination: Lapse

Answer 20

An Offer lapses after the period stated in the offer or if no duration is stated, after a reasonable time.

Question 21

Offer Termination: Death or incompetence of offeror

Answer 21

If the offeror dies or becomes legally incapacitated before acceptance, the offer ends automatically. This is true even if the offeree doesn’t know the offeror died – the offer is still terminated.

If accepted before death, it is enforceable.

However, exception: It does not terminate with offeror’s death, if it was held open under an option contract.