1. Agreement Chapter 10

2. Agreement Usually evinced by the existence of an offer and acceptance Requirements of the offer –Serious objective intent –Terms must be reasonably certain –Offer must be communicated to offeree

3. Requirements of the Contract Intention –Objective standard not subjective –Lucy v. Zehmer –Expression of opinion? –Statements of Intention “I plan” –Advertisements Generally not offers unless they limit the number of people that can accept

4. Intention Cont. Objective standard for offers –Pepsi Points Auctions –Generally not an offer – “invitation to bid” Unless without reserve

5. The effective offer A reasonable person would have found it to be an offer Terms must be reasonably definite Offer must be communicated to the offeree –Reward for missing dog

6. Termination of the offer Revocation –Offeror withdraws the offer Allowed unless an offer is irrevocable Can be express Or can be my actual notice –You see the car has been sold –If you make offer available to public you had better make revocation available to public by same means

7. Irrevocable Offers Usually for a certain period of time May be imposed by courts –Justifiable reliance –Promissory estoppel Options –Need consideration –Stated period of time

8. Rejection of Offer Rejection –Must be received by offeror Actual notice may be good enough –Counter offer would be a rejection Mirror image rule –Inquiries are not rejections

9. Termination by Operation of Law Lapse of Time –Usually stated by offeror Destruction of subject matter Death or incompetence of the offeror Supervening Illegality of the Proposed Contract

10. Acceptance A voluntary act by the offeree that shows assent or agreement to the terms of an offer, may consist of words or conduct Who can accept? –Offeree or agent Unequivocal Acceptance –Certain requests will not constitute conditions to acceptance eg: please send written contract

11. More Acceptance Silence as Acceptance –Usually silence is not an offeror Eg. Free c.d.s come in the mail and state that if you don’t call to cancel any subsequent c.d.s will be part of a contract –Exceptions Service provided to you that you knew D expected to be paid for Prior dealings

12. Acceptance Contd. Bilateral requires return promise Unilateral requires performance Mailbox rule: –Acceptance is good as soon as it is dropped in the mail –Default rule and can be contracted around –Revocation is only good when received by offeree

13. Consideration Value given in return for a promise Must have legal value –Promise to do something –Performance of an action –Refraining from an action Must not be prior duty –Promises don’t suffice

14. Contracts that Lack Consideration Courts do not generally look into the value of consideration However, certain contracts lack any consideration –Preexisting duty –Unforeseen consequences –Rescission and new contract –Past consideration –Illusory Promises I may or may not do something

15. Settlement of Claims Accord and satisfaction –Must be a dispute –Cannot have a liquidated debt Eg loan Release –Need (1) good faith (2) writing (3) consideration

16. Promissory Estoppel Also called detrimental reliance –Need the following elements Clear and definite promise Promisee must clearly rely on the promise Reliance must be of substantial and definite charactar Justice must be served by promissory estoppel