leb.pp.11 (Agreement)

leb.pp.11 (Agreement) - Chapter 11 Chapter The Agreement...

Info iconThis preview shows page 1. Sign up to view the full content.

View Full Document Right Arrow Icon
This is the end of the preview. Sign up to access the rest of the document.

Unformatted text preview: Chapter 11 Chapter The Agreement Requirements of an Offer 1. Intent to Contract Intent Serious, present, objective intent to enter present objective into contract, creating immediate power of acceptance of * Judged Objectively Objectively How would a reasonable person reasonable interpret the words, conduct, and words, circumstances? (rather than the circumstances (rather parties’ subjective intent) Requirements of an Offer Leonard v. Pepsico Buy Pepsi products, collect “Pepsi points,” exchange points for merchandise (7 million points = Harrier jet) Commercial not serious offer to sell jet; statement obviously made in jest (“zany humor”) Requirements of an Offer Requirements b. Preliminary Negotiations: NOT Offers b. NOT i. “I’d like to get $4,000 for this car” like Merely a suggestion that an offer suggestion be made; willing to discuss possibility of entering into contract possibility Requirements of an Offer Requirements b. Preliminary Negotiations: NOT Offers b. NOT ii. “I will not sell my house for less than less $56,000” $56,000” Merely an invitation to make an invitation offer; willing to discuss possibility discuss of entering into contract Requirements of an Offer Requirements Owen v. Tunnison P: Will you sell your store for $6,000? Will Merely a request that an offer request be made be D: I couldn’t sell it for less than $16,000 less Merely an invitation to make an offer invitation P: I accept P: No offer to accept Requirements of an Offer Requirements c. Advertisement: Generally NOT Offer c. NOT Merely an invitation to make an offer invitation (Limited number of items means seller can NOT intend to create NOT power of acceptance in everyone who sees ad) Ehrlich v. Willis Ehrlich Not an offer (even if price was correct) Requirements of an Offer Requirements Exceptions (Ads ARE Offers) ARE (1) Highly Specific Ads (limited quantity, and Highly language regarding who can accept) language (2) Special Method of Sale (specific action (2) Special required) Lefkowitz v. Great Minneapolis Lefkowitz P wins: highly specific ad Johnson v. Capital City Ford Johnson P wins: special method of sale Requirements of an Offer Requirements 2. Reasonably Definite Terms 2. Reasonably Thompson v. Liquidchimica of America Thompson No, an “agreement to agree” iis too s indefinite (not enforceable) indefinite Ogilvie v. Ogilvie Ogilvie No, an agreement to “aid and assist” iis s too indefinite (Bertha not liable) too Requirements of an Offer 2. Reasonably Definite Terms Hinc v. Lime-O-Sol Co. Hinc No, promise to use “best efforts” iis not s too vague; iit means at least some t too effort effort Requirements of an Offer Requirements Sales Law (UCC): Relaxes definiteness Relaxes requirement requirement * Must have definite quantity Must quantity * U.C.C. “gap fillers” for other terms U.C.C. for (price, payment, place of delivery) Requirements of an Offer Requirements 3. Communication of Proposal to Offeree 3. Communication Newman v. Schiff No contract Offer available during broadcast Offer only; not renewed for any not subsequent broadcast subsequent Requirements of an Offer Requirements Alfaro v. Stauffer Chemical Co. Ps lose: can NOT accept an offer they Ps NOT do not know about do Termination of Offer Termination 1. Revocation (withdraw offer) 1. Revocation a. General Rule: Revoke any time before a. General Revoke acceptance acceptance * Revocation effective upon receipt b. Exceptions (irrevocable offers) b. Exceptions i. Option Contract Option Real estate contract Real ii. Merchant’s Firm Offer Merchant’s iii. Partial Performance of Unilateral Partial Contract Contract Termination of Offer Termination 2. Rejection or Counteroffer 2. Rejection Rejection: “No” Rejection * Terminates offer (Inquiry about offer is not rejection) not Counteroffer: Different/New Terms Counteroffer * Terminates original offer * Constitutes new offer Termination of Offer Termination Thurmond v. Weiser S: I offer to sell my ranch for $260,000 S: * Offer Offer B: I offer to pay $250,000 * Counteroffer Counteroffer S: No * Rejection Rejection B: OK, I’ll pay $260,000 * Offer Offer S: No S: * Rejection Rejection ______________________________ ______________________________ NO CONTRACT Termination of Offer Termination Foster v. Ohio State University * No, phone call was counteroffer counteroffer (different start date that terminated terminated original offer) original * Counteroffer never accepted by OSU never Counter-inquiry Counter-inquiry * Does not terminate offer not Termination of Offer Termination 3. Lapse of Time 3. Lapse Length stated, or “reasonable period” Length Termination of Offer Termination 4. Death or Adjudication of Insanity 4. Death Adjudication * Does not terminate irrevocable offer not (option contract) Example #1 Example No contract (offer terminated) terminated Example #2 Valid option contract (binds Aidan’s estate) estate) Requirements of an Acceptance Requirements 1. Unconditional 1. Unconditional a. Match terms of offer a. Match “Mirror Image” Rule (traditional rule: Rule accept all terms) all Requirements of an Acceptance Lucier v. Town of Norfolk “Mirror Image” Rule not satisfied Mirror not * $35/day not same as $175/week $35/day not * No meeting of minds No * No contract No Requirements of an Acceptance Exceptions to “Mirror Image” Rule: * U.C.C. dispenses with Rule “Battle of the Forms” (buyer’s purchase order and seller’s confirmation form are not mirror images) * There can be an acceptance even if seller’s response includes additional terms * Additional terms can become part of contract between merchants Requirements of an Acceptance Review Video v. Enlighten Technologies D ordered, but never paid for, goods from P (both parties are merchants) P sued to recover past due amount plus monthly interest rate of 1.5% (per invoices) Interest payment becomes part of sales contract: (1) does not materially alter contract, and (2) D did not object Requirements of an Acceptance Requirements 2. Unequivocal 2. Unequivocal a. Not acceptances: Not * “I’ll think about it” * “If my spouse does not object” * “If my lawyer does not see anything wrong with it” Santandrea v. Siltec Corp. Santandrea No binding contract; equivocal No equivocal Requirements of an Acceptance Requirements b. Silence is NOT an acceptance, unless: b. NOT unless i. Offeree indicates acceptance, or Offeree ii. Past dealings indicate acceptance Past (1) Phelan v. Everlith (1) Phelan D does not have to pay: no past not no dealings dealings (2) Hobbs v. Massasoit Whip Co. (2) Hobbs D must pay: past dealings must past Requirements of an Acceptance Requirements c. ‘Shrinkwrap’ or ‘Click Wrap’ Problem Brower v. Gateway 2000 Brower * Ps are wrong Ps * Arbitration clause is one term of Arbitration contract that took effect when Ps kept computer beyond 30 days computer * Contract as a whole, including Contract arbitration clause, was enforceable enforceable Requirements of an Acceptance Requirements Caspi v. MSN Binding contract Specht v. Netscape No, mere act of downloading does not No, not manifest agreement (P did not have to not click on “I agree” button or even look at license in order to buy) Requirements of an Acceptance Requirements O’Quin v. Verizon Wireless Yes, most courts hold that this type of Yes, contract is binding contract Requirements of an Acceptance Limitations on the “Mailbox Rule” i. Offeror specifies different medium ii. Offeror requires actual receipt iii. Rejection sent before acceptance * First message received (rejection or acceptance) determines whether contract exists iv. E-mail * Effective when it hits recipient’s server (even if not yet read) Requirements of an Acceptance Requirements 3. Communication d. Examples: i. Case # 1 Case Contract exists as of 5 pm on Contract June 3 June ii. Case # 2 Case Contract exists as of 10 am on Contract June 3 June Requirements of an Acceptance Cushing v. Thompson Binding contract (offer accepted before Binding revoked) revoked) Requirements of an Acceptance Morrison v. Thoelke Morrison Contract as of 11/27 ...
View Full Document

This note was uploaded on 08/24/2011 for the course LEB 323 taught by Professor Baker during the Spring '08 term at University of Texas.

Ask a homework question - tutors are online