Contracts - Acceptance

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Author:
anniebnd
ID:
3380
Filename:
Contracts - Acceptance
Updated:
2009-12-20 19:16:00
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Taft
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Description:
Contracts - Acceptance
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  1. Is a subjective standard used to determine whether there has been a valid acceptance?
    No. Objective standard is used.
  2. In whom does the power of acceptance rest?
    Only the person the offer was made to. The offeror has control of who the offer is made to or how many people.

    Exception: Options contracts, in this case offeree can sell his right of acceptance and the offeror has no control over the choice of offeree (unless he specifically provides otherwise in the option agreement).
  3. Does an offeree accept an offer to enter into a bilateral contract by performing?
    No, Bilateral contract is accepted by promising to perform.

    Exception: If offer is ambiguous as to unilateral or bilateral, the offeree has the choice of performing or promising to perform.

    UCC section 2-206 - an offer to buy goods that is ambiguous as to means of acceptance can be accepted either by a prompt promise to ship or prompt shipment.
  4. How is a unilateral contract accepted?
    By performance.
  5. Can silence constitute acceptance?
    General rule is No.

    Exceptions: A prior agreement between parties that silence will mean acceptance or the offeree takes benefits or exercises dominion over what the offeror offers, having had an opportunity to reject.
  6. What are the six ways an offer may be terminated (except through acceptance)?
    Mnemonic: ReD DIRT

    Revocation, Destruction of subject matter, Death or insanity, Illegality, Rejection/counter-offer, and Time
  7. Under common law, in accepting an offer, may an offeree request additional terms?
    No. Mirror-Image rule, acceptance had to be a mirror image of offer to constitute valid acceptance, otherwise it was considered a rejection and counter-offer.

    UCC section 2-207 - For transanctions of goods, more liberal in treating new terms where the contract is between merchants.
  8. What differences does the UCC make to the common law mirror-image rule?
    Depends on the following conditions:

    UCC section 2-207

    Non-Material additions: If both parties are merchants, the offeror has not limited the offer to the original terms and the changes are not material, the offeror's silence on the additional terms constitutes acceptance of the terms. Must have reasonable time to object.

    Material Additions: If the additional term proposes a material change, it will require assent to become part of the contract.

    Different Terms: If a proposal is considered to provide a different term, most courts would deem the contract silent on the matter.
  9. Is a revocation effective when dispatched under the mailbox rule?
    Yes and No. Depends on jurisdiction. Mailbox rule only concerns acceptance, not revocations, but some states make revocations effective when sent, while most states make revocation effective when received.
  10. Does an offer continue until it is expressly revoked?
    No. Reasonable time, depending on circumstances.

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