Termination of an Offer Flashcards
What are the 3 ways to terminate an offer?
1) rejection
2) time lapse
3) revocation
How does a counter-offer work with rejection?
Where an offeree makes a counter-offer, the original offer is deemed to have been rejected and cannot be subsequently accepted
What happens to the original offer if the counter-offer has been accepted?
terms of counter offer become terms of the contract - not the terms of the original offer
If further information/clarification is required on an offer, rather than actually counter-offering, how does this effect the offer?
original offer remains open for acceptance.
How can an offer lapse? (2 ways)
a) by passage of time;
b) by the death of one of the parties.
How is passage of time considered?
a) where acceptance not made within period prescribed by offeror;
b) where no period prescribed + acceptance is not made within a reasonable time. What’s reasonable = depends on circumstances of the case.
When can an offeror revoke their offer?
BEFORE acceptance
When will a revocation of an offer be effective?
only upon actual notice of it reaching the offeree.
What happens if revocation is communicated by post?
it takes effect from the moment it is received by the offeree + NOT from the time of posting
Can indirect communication be used to revoke an offer?
YES - provided offeror has shown (words or conduct) clear intention to revoke their offer + notice has reached the offeree, then revocation effective.
The means of communication do not matter, so the revocation will be effective even if communicated by a third party
What is the general rule of revocation to unilateral contracts?
remains possible to revoke the offer at any time prior to the completion of the required act
What is the exception to the general rule of revocation to unilateral contracts?
offeror may be under an implied obligation not to revoke offer once performance has commenced.
- where offeree partly performed obligation + willing n able to complete - it would undoubtedly cause hardship to the offeree to allow offeror to withdraw the offer in this situation.
offeree’s acceptance + consideration for this implied promise is starting to perform the required act.
What about revoking an offer in unilateral contracts made to the ‘whole world’?
seems likely that revocation will be effective if the offeror takes reasonable steps to bring the revocation to the attention of all those who may have read the offer.
