Quiz 11: Nature and Terminology

Business

Here, S responds to B's inquiry with invitation for an offer. A contract must have reasonably certain terms, related to the price and timing of the contract. Thus, S's response to B could be seen as a preliminary negotiation. It is not an offer. B's letter back including a set price of $60,000 is then the offer, which S must accept to form a contract. However, without S's acceptance, there is no contract.

Offer. A bid can be an offer if it contains all of the requisite elements: a serious, objective intent on the part of the offerer and an offer conversed to the offeree in certain, definite terms understandable to both parties. A's bid met the requirements His determination appeared to be that of a serious, reasonable offeree; the terms were sufficiently definite; and the bid was communicated to D. If the price, materials, and start date were left open, these factors might be adequate to question the status of the bid as an offer. The three requirements to constitute an offer and they are as follows: a. There must be a serious intention by offerer to become bound by the offer. b. There must be certain and reasonable definite terms of contract to ascertain by the courts and parties itself. c. There must be a communication of offer by the offerer to offeree. If we look at this case, then A definitely met the necessities of an offer as he does have serious intention to perform the building work of and the offer contains certain terms as to build the recording studio in the lowest price and he conversed his offer to D.

a) Offer and Acceptance - Death: According to termination by operation of law, the death of the offeror or offeree is an event that terminates the power of the offeree to transform an offer into a binding legal obligation. b) Offer and Acceptance - Destruction : According to termination by operation of law, the destruction of specific subject matter of the offer is an event that terminates the power of the offeree to transform an offer into a binding legal obligation. In this case, the equipment is destroyed by fire, and the equipment is specific subject matter. Without the subject matter to bind the contract, there is no contract. c) Offer and Acceptance - Death : According to termination by operation of law, the death of the offeror or offeree is an event that terminates the power of the offeree to transform an offer into a binding legal obligation. Regardless of when Barry accepted the offer, the heirs to Schmidt's estate are not obligated to fulfill the contract because it was a personal agreement between the two parties. This offer was not irrevocable. d) Offer and Acceptance - Death : Barry's estate was not legally required to continue the contract between Barry and Schmidt, however since the estate accepted the offer, then the estate has entered into a legally binding agreement with Schmidt. This does not make the offer irrevocable since Schmidt did not enter into the contract with Barry's estate and Schmidt has the option to cancel the contract because it was with Barry and Barry is dead. According to termination by operation of law, the death of the offeror or offeree is an event that terminates the power of the offeree to transform an offer into a binding legal obligation.

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