ACTG 2P40 Lecture Notes - Option Contract
Document Summary
Chpt 5 formation of a contract: offer and acceptance. In order for a fully binding contract to exist you must have 3 elements: offer, acceptance, consideration. All elements must exist in order to have a fully binding contract. All elemnts must be voluntary: offer (a) offer vs. Invitation to treat (b) basic rules that apply to the offer. Revoke before acceptance even if promised to keep offer open , even before lapse date but not after acceptance (a) option. Contract within a contract to keep offer open by paying: counter offer(negotiation) money , this is full binding, original offer falls off the table, no longer exist ever, new offer on the table. Mere inquires are not new offers but just mere inquiries about the original offer , questions about the 1st offer?: acceptance. Communication of acceptance ( same form as offer , words or conduct ) Postal rule ( mail to mail offer & acceptance )
