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Business Law Chapter 10


undefined, object
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A proposal indicating a willingness to enter into a contract
Person making the offer
Person to whom the offer is being made
Offeree must have knowledge of the offer and the offer must be made by the offeror or her authorized agent to the offeree
Determined by an objective standard of what a reasonable offeree would have believed
Without Reserve
Auctioneer may not withdraw the goods from the auction
Offer's terms must be clear enough to provide a court with a basis for giving an appropriate remedy
Good Faith
Honesty in fact
Commercial Reasonableness
Judgement of reasonable persons familiar with the business transaction
Requirements Contract
An agreement of a seller to supply a buyer with all his requirements for certain goods
Lapse of Time
Offer remains open for the time period specified or if no time is stated for a reasonable period of time
Cancellation of an offer by an offeror; generally an offer may be terminated at any time before it is accepted
Contract providing that an offer will stay open for a specified period of time
The inducement to enter into a contract, consisting of an act or promise that has legal value
Firm Offer
Irrevocable offer by a merchant to sell or buy goods, made in a signed writing that gives assurance that it will not be revoked for up to three months
Statutory Irrevocability
Offer made irrevocable by statute
Irrevocable Offer of Unilateral Contracts
A unilateral offer may not be revoked for a reasonable period of time after performance is begun
Promissory Estoppel
Noncontractual promise that binds the promisor because she should reasonably expect that the promise will induce the promisee to take action in reliance on it
The refusal to accept an offer
Counterproposal to an offer
Conditional Acceptance
Acceptance of an offer contigent upon the acceptance of an additional or different term
Death or Incompetency
Of either the offeror or the offeree terminates the offer
Destruction of Subject Matter
of an offer terminates the offer
Subsequent Illegality
Of the purpose or subject matter of the offer terminates the offer
Manifestation of a willingness to enter into a contract on the terms of the offer
Effective Moment
Acceptance effective upon dispatch unless the offer specifically provides otherwise or the offeree uses an unauthorized means of communication
Stipulated Provisions in the Offer
The communication of acceptance must conform to the specifications in the offer
Authorized Means
Usually any reasonable means of communication
Unauthorized Means
Acceptance is effective when received, provided that it is received within the time within which the authorized means would have arrived
Acceptance Following a Prior Rejection
First communication received by the offeror is effective
Defective Acceptance
Does not create a contract but serves as the new offer
Mirror Image Rule
An acceptance cannot deviate from the terms of the offer

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