LAW for Business and Personal Use © 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. CHAPTER 6 Offer and Acceptance Creation of Offers Termination of Offers Acceptances

LAW for Business and Personal Use © 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter 6 SLIDE 2 6-1Creation of Offers GOALS List the elements required to form a contract Describe the requirements of an offer

LAW for Business and Personal Use © 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter 6 SLIDE 3 REQUIREMENTS OF A LEGALLY ENFORCEABLE CONTRACT 1.Offer and acceptance 1.Offeror – the person making the offer 2.Offeree – the person accepting the offer 2.Genuine assent 3.Legality 4.Consideration 5.Capacity 6.Proper form

LAW for Business and Personal Use © 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter 6 SLIDE 4 NATURE AND CLASSES OF CONTRACTS Executed and executory contracts Express, implied-in-fact, and implied-at-law (quasi) contracts Unilateral and bilateral (multilateral) contracts

LAW for Business and Personal Use © 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. What is it? I tell my sister I will pay her $ if and when she paints the fence. If she promises to do so, is it a bilateral contract or a unilateral contract.? It is a unilateral contract because it is performance based not a promise. Chapter 6 SLIDE 5

LAW for Business and Personal Use © 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter 6 SLIDE 6 CHECKPOINT What elements are required to form a legally enforceable contract?     

LAW for Business and Personal Use © 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter 6 SLIDE 7 REQUIREMENTS OF AN OFFER Contractual intent must be present Jests Statements made in anger or terror Preliminary negotiations Social agreements Offer must be communicated to the offeree Essential terms must be complete and definite

LAW for Business and Personal Use © 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter 6 SLIDE 8 CHECKPOINT What are the requirements of an offer?     

LAW for Business and Personal Use © 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter 6 SLIDE 9 6-2Termination of Offers GOALS Describe the various ways to end offers Explain how an offeree can ensure an offer will remain open

LAW for Business and Personal Use © 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter 6 SLIDE 10 HOW CAN OFFERS BE ENDED? Revocation by the offeror Time stated in the offer Reasonable length of time Rejection by the offeree Counteroffer Death or insanity of either the offeror or offeree Destruction of the specific subject matter

LAW for Business and Personal Use © 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter 6 SLIDE 11 CHECKPOINT Explain two ways in which offers can be terminated. Revocation by the offeror Time stated in the offer Reasonable length of time Rejection by the offeree Counteroffer Death or insanity of either the offeror or offeree Destruction of the specific subject matter     

LAW for Business and Personal Use © 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter 6 SLIDE 12 HOW CAN AN OFFER BE KEPT OPEN? Options Firm offers

LAW for Business and Personal Use © 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter 6 SLIDE 13 CHECKPOINT How could an offeree ensure that an offer will stay open for a set period of time?     

LAW for Business and Personal Use © 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter 6 SLIDE Acceptances GOALS Discuss the requirements of an effective acceptance Determine at what point in time an acceptance is effective

LAW for Business and Personal Use © 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter 6 SLIDE 15 WHAT IS REQUIRED OF AN ACCEPTANCE? Only offerees may accept The acceptance must match the offer Acceptance must be communicated to the offeror Silence as acceptance Promises as acceptance Performance as acceptance Modes of contractual communication When acceptances are effective

LAW for Business and Personal Use © 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter 6 SLIDE 16 CHECKPOINT What are the requirements of an effective acceptance? Only offerees may accept The acceptance must match the offer Acceptance must be communicated to the offeror     

LAW for Business and Personal Use © 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter 6 SLIDE 17 PREVENT LEGAL DIFFICULTIES When you seek to enter into a contract... When negotiating, assume the worst and include terms in the contract addressing potential problems. For important contracts, put offers and acceptances in writing. If either an offer or an acceptance is made orally, promptly confirm it in writing. Obtain and keep a copy of every important document you sign. Express your intentions in offers and acceptances with clear, complete, and understandable language. Continued on the next slide

LAW for Business and Personal Use © 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter 6 SLIDE 18 PREVENT LEGAL DIFFICULTIES Remember that the offeror may specify how and when the offer must be accepted. Otherwise the offeree may use the same means used by the offeror, a faster means, or other reasonable means. When appropriate, buy an option, if one is available, to keep the offer open for as long as you need. Remember that for an offeror to withdraw or revoke an offer, the offeree must receive notice. For speed, use the telephone, , or fax machine to withdraw or revoke an offer.