Business Law Chapter 10

Business Law Chapter 10 - Business Law Chapter 10...

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Business Law Chapter 10 Requirements for an Offer An offer is the critically important first step in the contract formation process An offer says, “This is it-if you agree to these terms, we have a contract.” The person who makes the offer (the offeror) gives the person whom she makes the offer (the offeree) the power to bind her to a contract simply by accepting the offer To distinguish an offer, courts look for: o Some objective indication of a present intent to contract on the part of the offeror o Look for specificity or definiteness, in the terms of the alleged offer o Look to see whether the alleged offer has been communicated to the offeree Intent to Contract Present intent means the intent to enter the contract upon acceptance It signifies that the offeror is not joking, haggling, or equivocating The Objective Standard of Intent An offeror’s intent will be judged by an objective standard-what his words, acts, and the circumstances signify about his intent Definiteness of Terms A proposal that fails to state specifically what the offeror is willing to do and what he asks for in return for his performance is unlikely to be considered an offer Definiteness and specificity in an offer tend to indicate an intent to contract Courts need to know the terms on which the parties agreed in order to determine if a breach of contract has occurred and calculate a remedy if it has Definiteness Standards under the Common Law Classical contract law took the position that courts are contract enforcers, not contract makers The trend of modern contract law is to tolerate a lower degree of specificity in agreements Definiteness Standards under the UCC The UCC often creates contractual liability in situations where no contract would have resulted at common law Contracts under article 2 can be created in any manner sufficient to show agreement, including conduct which recognizes the existence of a contract Under code, the fact that the parties left open one or more terms of their
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This note was uploaded on 11/16/2010 for the course BMGT 380 taught by Professor Mark during the Spring '08 term at Maryland.

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Business Law Chapter 10 - Business Law Chapter 10...

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