Week 3 - Questions and Answers
Chapters 6 and 7 (7 edition)
Chapters 7 and 8 (8 edition)
Chapter 6 (7 edition) Chapter 7 (8 edition)
4. Q: Describe the “rules” for acceptance, and explain why such rules are necessary.
A: The rules for acceptance:
Only the person to whom an offer is made can accept the offer;
Acceptance must be communicated in the manner requested or implied by the offeror;
Where acceptance is by mail, the acceptance is effective on the date the acceptance is
placed in the mail;
Where communication is instantaneous, acceptance occurs when it is received by the
offeror, and the contract is made where acceptance is received;
Acceptance that proposes different terms than the original offer is not an acceptance, it
is a counter-offer;
Silence is not acceptance, unless specified in the offer and agreed to by both parties;
If acceptance is communicated in a manner different than that specified, acceptance
occurs when it is communicated to the offeror;
Where an offer is a unilateral offer, acceptance is by an offeree’s performance of its
It stands to reason that since the very formation of a contract requires offer and
acceptance, rules have evolved for greater certainty, so that the parties can “know”
when an offer has been made and accepted.
6. Q: Explain the term “counteroffer”, and describe how it might arise.
A: A counter-offer occurs when a party does not accept the original offer but proposes
new terms or changes to the contract. The newly proposed agreement is different from
the offer, it becomes an offer on its own.
9. Q: Explain the rationale behind the rule that states than an offer by mail invites
acceptance by mail, and that the acceptance is complete when a properly addressed
letter of acceptance is dropped in a mailbox.
A: Obviously when a letter is placed in the mail, it is not predictable with any degree of
certainty exactly when the letter will be delivered. Where parties prefer to do offering
1 and accepting by mail, for greater certainty the postal acceptance rule provides a
consistent and predictable rule stating that once the acceptance is placed in the mail, it
takes effect. If this is inadequate, parties are at least aware of the rule and can avoid its
consequences by not using the mail, or specifying some other time for acceptance in
the contract itself.
10. Q: What condition must be met before revocation of an offer is effective.
A: Revocation of an offer must be communicated to the offeree before it is effective.
12. Q: How does acceptance of a unilateral agreement differ from that of an
A: No notice of acceptance is required, acceptance occurs upon performance of the
offeree’s obligations under the contract.
There are a number of issues raised in this case. First, the dealings between the parties
evolved into an understanding of sorts over the years. It is evident that business practice was
established so that silence could be considered to be acceptance, even though this is not the
Arguably, there is no requirement that the juice company purchase the crop of apples, and it is
easy to argue also that the new president may not have been aware of the previous
One would also argue that ordinarily, simply leaving the apples on the juice company’s
property should not result in liability on the part of the juice company. The general rule is
parties cannot “foist” obligations on persons without their consent. However, there is an
obligation once the new president was aware of the difficulty, and perhaps he should have
made more significant efforts to remove the apples and return them to their owner. At least he
should not have relied on simply sending a letter, especially given that the items wer