Business Law Chapter 10
Terms
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- Offer
- A proposal indicating a willingness to enter into a contract
- Offeror
- Person making the offer
- Offeree
- Person to whom the offer is being made
- Communications
- Offeree must have knowledge of the offer and the offer must be made by the offeror or her authorized agent to the offeree
- Intent
- Determined by an objective standard of what a reasonable offeree would have believed
- Without Reserve
- Auctioneer may not withdraw the goods from the auction
- Definiteness
- 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
- Revocation
- Cancellation of an offer by an offeror; generally an offer may be terminated at any time before it is accepted
- Option
- Contract providing that an offer will stay open for a specified period of time
- Consideration
- 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
- Rejection
- The refusal to accept an offer
- Counteroffer
- 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
- Acceptance
- 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