Chapter 10: Mutual Assent

Question 1

Offer

Answer 1

A proposal indicating a willingness to enter into a contract.

Question 2

Offeror

Answer 2

Person making the offer.

Question 3

Offeree

Answer 3

Person to whom the offer is made.

Question 4

Communication

Answer 4

Offeree must have knowledge of the offer and the offer must be made by the offeror her authorized agent to the offeree.

Question 5

Intent

Answer 5

Determined by an objective standard of what a reasonable offeree would have believed.

Question 6

Without reserve

Answer 6

Auctioneer may not withdraw the goods from the auction.

Question 7

Definiteness

Answer 7

Offer’s term must be clear enough to provide a court with a basis for giving an appropriate remedy.

Question 8

Good faith

Answer 8

Honesty in fact in the observance of reasonable commercial standards of fair dealing.

Question 9

Commercial reasonableness

Answer 9

Judgment of reasonable person familiar with the type of business transaction involved.

Question 10

Output contract

Answer 10

An agreement of a buyer to purchase the entire output of a seller’s factory.

Question 11

Requirements contract

Answer 11

An agreement of a seller to supply a buyer with all his requirements for certain goods.

Question 12

Lapse of time

Answer 12

Offer remains open for the time specified or, if no time is stated, for a reasonable period of time.

Question 13

Revocation

Answer 13

Cancellation of an offer by an offeror; generally, an offer may be terminated at any time before it is excepted.

Question 14

Option Contract

Answer 14

Contract providing that an offer will stay open for a specified period of time.

Question 15

Consideration

Answer 15

The inducement to enter into a contract,, consisting of an act or a promise that has legal value.

Question 16

Firm offer

Answer 16

Irrevocable offer by a merchant to sell or buy goods, made an assigned writing that gives assurance that it will not be revoked for up to three months.

Question 17

Statutory irrevocability

Answer 17

Offer made irrevocable by statute.

Question 18

Irrevocable offer of unilateral contracts

Answer 18

A unilateral offer may not be revoked for a reasonable time after performance is begun.

Question 19

Promissory estoppel

Answer 19

Non-contractual promise that binds to promise her because she should reasonably expect that a promise will induce the promisee (offeree) to take action in reliance on it.

Question 20

Rejection

Answer 20

The refusal to except an offer.

Question 21

Counter offer

Answer 21

Counter proposal to an offer.

Question 22

Conditional acceptance

Answer 22

Acceptance of an offer contingent upon the acceptance of an additional or different term.

Question 23

Death or incompetency

Answer 23

Of either of the offeror or the offeree terminates the offer.

Question 24

Distraction of subject matter

Answer 24

Of an offer terminates the offer.

Question 25

Subsequent illegality

Answer 25

Of the purpose or subject matter of the offer terminates the offer.

Question 26

Acceptance

Answer 26

Manifestation of a willingness to enter into a contract on the terms of the offer.

Question 27

Effective moment

Answer 27

Acceptance affective upon dispatch unless the offer specifically provides otherwise or the offeree uses an unauthorized means of communication.

Question 28

Stipulated provisions in the offer

Answer 28

The communication of acceptance must conform to the specifications in the offer.

Question 29

Authorized means

Answer 29

Usually any reasonable means of communication.

Question 30

Unauthorized means

Answer 30

Acceptance affective when received, provided that it is received within the time within which the authorized means would have arrived.

Question 31

Acceptance following a prior rejection

Answer 31

First communication received by the offeror is effective. 

Question 32

Defective acceptance

Answer 32

Does not create a contract but serves as a new offer.

Question 33

Mirror image rule

Answer 33

An acceptance cannot deviate from the terms of the offer.