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Sources: Fallsview Glatt Kosher Caterers, Inc. v. Rosenfeld, 794 N.Y.S.2d 790 (NY 2005); http://lawprofessors.typepad.com/
contractsprof_blog/food_and_drink/ 7.1 Offer and Acceptance of the Sales Contract A rticle 2 modifies the common law rules affecting contract formation, firm offers
made by merchants, the valid methods for accepting an offer, and the effect of
some acceptances that contain additional terms. It may be helpful to remember that the offer could be either to buy or to sell goods, and
that a merchant can be either an offeror or offeree, depending upon who initiates the contract. Also, don’t forget that UCC Article 2 applies to all sales of goods contracts, whether rog80328_07_c07_134-156.indd 139 10/26/12 5:52 PM Section 7.1 Offer and Acceptance of the Sales Contract CHAPTER 7 merchants are involved or not, but there are some rules such as the firm offer under Section 2-209 that only apply to a merchant (although the offeree can be a non-merchant)
and other sections such as the additional terms exception under UCC Section 2-207 that
applies only if both parties are merchants. Merchant’s Firm Offers (§ 2-205)
The common law rule regarding firm offers (an offer that states it will be open for a period
of time) is that they are revocable unless the firm offer is supported by consideration (in
which case it is an option, or a contract to keep an offer open). The UCC changes this
rule when firm offers are made by merchants. Section 2-205 of the UCC makes a promise
by a merchant, in a signed writing, that gives assurance that the offer will be held open,
irrevocable for the stated period or, if no specific period is stated, for a reasonable time.
However, the time period cannot exceed three months; if the offer says it’s open for six
months, the UCC automatically shrinks the time period down to three months.
Example 7.2. The president of Alpha Inc. writes a letter to Jemal, stating
that Alpha will sell Jemal “15 office desks at $700 per unit. Offer to remain
open for 30 days,” signed Stephen Wright, President, Alpha Inc. Because
desks are portable, tangible objects, and Alpha Inc. is in the business of selling such items, and the offer was made in a signed writing, it is a firm offer
that must stay open for the 30-day period. It does not matter that Jemal has
given no consideration.
Example 7.3. The president of Beta Inc. writes a letter to Ahmad, offering
to sell him Beta’s factory for $100,000, adding that the offer is good for
14 days, and signing it “Jose Cruz, President.” Because the factory is real
estate, this is not a firm offer, and it may be revoked at any time.
For purposes of the UCC, a merchant is one who regularly deals in goods of the kind
involved in the contract, or someone for whom the transaction is occurring in the course
Example 7.4. Rahim, a used car salesman, offers to sell Dana a 2005 Lincoln
Navigator for $6,500. Dana tells Rahim that she is interested in the vehicle
but needs some time to think about it. Rahim then ve...
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