REQUIREMENTS OF THE OFFER (p. 315) - A proposal from the offeror to the offeree - The offeror presents a conditional statement that says what the offeror will give offeree once offeree returns a specified promise or act - The word “statement” includes gestures, actions, words (written and oral) etc.
- For an act to constitute a legal offer it must have: 1) an intent to contract, 2) a reasonable indication of what both parties are to do, and 3) a communication of proposal to the offeree The Intent to Contract Preliminary Negotiations - Tentative or exploratory language does not constitute an offer: saying “I want to get $4,000 for my car” is not an offer and cannot be accepted - Similarly, if someone asks a question without genuine intent to contract there is no offer. Example: “will you rent your condo in June for $900?” “Yes” is not an offer to rent the home during June for $900 - If the same offer is made to multiple offerees, though the intent is to only create a contract with only one offeree, the offer is not an offer but part of preliminary negotiations. RICHARDS v. FLOWERS ET AL. (1961) Facts: - In 1959 Mrs. Richards wrote to Flowers expressing interest in buying Flowers’ Oakland property so long as they could deal with Flowers directly and not use a realtor. Richards instructed Flowers to reply with the cash amount he would expect to receive. - Flowers replied that he would be happy to deal directly with Richards and that he would expect to receive $4,500 for the property and would be awaiting their decision - Days later Richards replied that they would accept the offer on those terms. - 10 days later Flowers entered into an agreement with a third party to sell the house. - Richards claimed that their correspondence constituted a contract while Flowers said his letter was not an offer to sell. Richards requested specific performance of the contract. - Trial court ruled that Flowers had made an offer but Richards did not validly accept. Opinion (Shoemaker, Justice, California Court of Appeals): - Court agreed with Flowers that his letter was not an offer but an invitation for Richards to make an offer. - It’s common during a bargain for one party to induce the other party to make an offer by suggesting with some certainty the contract he is willing to enter into. This is considered preliminary negotiations. Court felt this is what Flowers did. - Flowers was merely answering inquiries by Richards (How much $? And could they deal with each other directly?) and he stated he would be willing to deal if “offer was in cash” meaning he anticipated an offer. - Since there was never an offer there was never a contract. The court affirmed. Other Evidence on the Question of Intent - Aside from language courts will consider other factors to determine intent: - Evidence of well established custom in an industry that parties are in - Evidence of a custom established between the parties from previous similar transactions - Evidence from the conduct of parties before and after agreement -
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- Spring '08