IS THERE A DEAL?A. Determining meeting of the minds 1. Rest. (2nd) Cont. § 24 Offer Defineda. Would a reasonable person in the position of the offeree understand from the offeror’s words and conduct an intent to be bound?b. Did the offeree in fact so believe?c. Lucy v. Zehmer 14i. Holding: K formed. document signed and both parties outwardly agree to it, intentions are irrelevant. The buyer was reasonable in believing that the offer was valid and the seller did nothing at the time to make him doubt the sincerity of the offer. a) Depends on whose story is true. Determine based on the facts according to Π AND on the facts according to Δ.b) If offeree knows that offeror made a mistake or didn’t intend to sell→no offer.d. Leonard v. Pepsico 25i. Rest. (2nd) Cont. § 29 To Whom an Offer Is Addressedii. Holding: Law tends to presume that advertisements Do Not make “definite and operative offers” to buy or sell goods. An objective person would doubt that the commercial constituted an offer to sell a harrier because the whole commercial was supposed to be humorous.a) This was an invitation to offer.b) When you see an ad, do you think that your “assent is invited” to close the deal? No. The ad becomes an offer when you get up to the cashier. Objectively, ads aren’t offers b/c a reasonable person wouldn’t interpret an ad as an offer but as mere information. It can be interpreted as an invitation to make an offer.e. Smith v. Boyd 36i. Rest. (2nd) Cont. § 27 Existence of Contract Where Written Memorial Is Contemplated. ii. Holding: Boyds did not intend to contract before signing a written purchase-and-sales-agreement form. Smiths knew or should have known that it’s not a contract b/c a reasonable person knows that in Real Estate deals an oral agreement is not binding and that a contract is not binding until the second signature is made.f. Problems on Mutual Assenti. Ponoroff sells car to Markell. No offer if M knows that P misspoke. Depends on the price of the car.B. Offer1. See Rest. (2nd) Cont. § 24 Offer Defined:a. Lonergan v. Scolnick 45i. See Rest. (2nd) Cont. §26 Preliminary Negotiations:a) Holding: No offer. The letter of April 8 which stated that buyer should hurry because other buyers would show up in the next week or so should have alerted buyer that seller intended to sell the property to the first comer.b. Fairmount Glass Works v. Grunden-Martin Woodenware Co. (1899) 49i. U.C.C. § 1-201. General Definitions.a) 3. “Agreement,” as distinguished from “contract,” means the bargain of the parties in fact, as found in their language or inferred from other circumstances, including course of performance, course of dealing, or usage of trade as provided in Section 1-303.ii. U.C.C. § 2-204. Formation in General.iii. Holding: Yes. “Quote” was more than a quote…it was an offer. This is an exception to the general rule. Defendants had to know that the plaintiffs were intent on purchase by the first telegram and “for immediate acceptance” sounds like an offer.c. Donovan v. RRL Corporation 55i. See Rest. (2nd) Cont. §26. Preliminary Negotiations:ii. Rest. (2nd) Cont. § 27. Existence of Contract Where Written Memorial is Contemplated. iii. Rest. (2nd) Cont. § 29 To Whom an Offer Is Addressediv. Holding: Ad was an offer and K formed. But unenforceable. See below.a) Why are ads generally not offers? Reasonable people look at ads and don’t think that they’re one step away from a K. they know that the ad is just information.b) Lefkowitz (p. 66 of text)– guy shows up for a mink fur. They refuse b/c he’s not a woman. He asks for them to show in the ad where it says it. Process repeats itself. The first time around Lefkowitz would win. The second time around, he’s on notice. Applying reasonable person standard, Lefkowitz should lose the second time around because he has reason to know. Court rules for Lefkowitz on the second visit because the ads “were clear and left nothing open for negotiation.” Court is saying to store: “change your ad.”c) Agnew v. Great Atlantic 69. Agnew (atty) saw sign in front of grocery store “Buy one get one free” for this week, with no limitations. Got two of a few groceries. Cashier didn’t give discount; “only applies to certain items.” Agnew purchased the items and filed complaint for violation of GA Fair Business Practice Act. Ct of appeals aff’ed trial ct’s dismissal – “Π purchased items knowing that the sign did not mean what it said.” Different outcome if claim for breach of K?C. Termination of Offer: “Destroying the offer”1. Rest. (2nd) Cont. § 36. Methods of Termination of the Power of Acceptance.2. Indirect revocationa. Dickinson v. Dodds (GB 1876) 70i. Rest. (2nd) Cont. § 43. Indirect Communication of Revocation.ii. Holding: No offer that Dickinson could accept. No consideration → no option k; just an offer. Dickinson, through his representative, knew that Dodds had sold the property to third party (Allen) → Offer revoked so no offer for Dickinso
ontrol and mastery over the terms of the offer.c. Davis v. Jacoby 109i. Rest. (2nd) Cont. § 30. Form of Acceptance Invited.ii. Rest. (2nd) Cont. § 32. Invitation of Promise or Performance.iii. U.C.C. § 2-206. Offer and Acceptance in Formation of Contract.iv. Holding: Bilateral K – promise for a promise. Davis’ 4/14 ltr is promise to perform.a) This is a “maybe” case.b) Despite Rest. § 32, offeror can specify if he wants acceptance by performance. Offeror probably didn’t have a specific intention on how acceptance would take place.3. Effectiveness of Promissory Acceptancea. Hendricks v. Behee 118i. See Rest. (2nd) Cont. § 50. Acceptance of Offer Defined; Acceptance by Performance; Acceptance by Promise.ii. Holding: Behee withdrew offer before it was accepted. Uncommunicated intention to accept an offer ≠ acceptance. When offer calls for a promise (as opposed to an act), notice of acceptance is essential. Notice to agent = notice to principal.b. Adams v. Lindsell (KB 1818) 121a) Rest. (2nd) Cont. § 63. Time When Acceptance Takes Effect. [Analog to the common law “mailbox rule.”]ii. Rest. (2nd) Cont. § 64. Acceptance by Telephone or Teletype.iii. See U.C.C. § 2-204. Formation in General.iv. Holding: Where offer is by mail, acceptance is effective on dispatch. Offeror bears the risk of time lag because he initiated communication by mail. In this case, offeror specified acceptance by mail.a) Can opt out of the mailbox rule by stating acceptance is effective upon receipt.b) Modern forms of communication require acceptance upon receipt.c) If offer by fedex, mailbox rule doesn’t apply to acceptance by mail. If offer by mail, unclear if mailbox rule applies to acceptance by fedex.d) Someone must bear superior risk that communication will be lost or delayed during transit. Might as well be offeror since he’s master of the offer.c. Problems on the Mailbox Rulei. Rest. (2nd) Cont. § 40. Time When Rejection or Counter-offer Terminates the Power of Acceptance.
