Offers and the power of acceptance

Assent in Context: The Outward Signal of Commitment

A manifestation of assent exists when a person’s words or conduct, viewed objectively in context, communicate present commitment rather than a private thought, joke, or invitation to keep negotiating. The controlling question is what a reasonable person in the recipient’s position would understand-not what the actor secretly intended.

Run two questions:

1. Was there an outward signal? Words, writing, signing, clicking, handing over an item, or conduct can communicate assent. Silence ordinarily supplies no manifestation because it communicates nothing, although the acceptance rules covered in the sibling chapter recognize limited circumstances in which silence can operate differently.

2. Did the signal show present commitment? “I will sell it for $500” can show commitment. “I might sell it,” “I am considering selling it,” or “I will ask my partner” ordinarily reserves a decision and signals negotiation, not assent. A statement made in obvious jest is not assent when a reasonable listener would understand the joke.

An undisclosed intent not to be bound usually does not defeat a manifestation that reasonably appears serious. Conversely, an undisclosed intent to be bound cannot turn an objectively tentative statement into an offer. Context matters: surrounding negotiations, customary business language, the parties’ relationship, the setting, and whether the speaker retained approval authority can all change what the words reasonably communicate.

An offer is a particularly important manifestation of assent: it shows willingness to enter a bargain so that the reasonable offeree understands that assent is invited and will conclude the bargain. Identifying an offer therefore requires more than finding definite words. Ask whether the communication is directed to an identifiable person or class, expresses present commitment, and supplies enough certainty that the offeree knows what assent would accept. A communication can manifest seriousness without being an offer-for example, a firm price quote that still says “subject to management approval.”

This chapter is closed-book-you must be able to state these triggers and consequences from memory.

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Offers at the Boundary: Advertisements Rewards and Precision

The ordinary advertisement is an invitation for customers to make offers, not an offer itself. The usual reasons are that the advertisement is directed to the public generally, leaves quantity or allocation uncertain, and does not show that the advertiser will be bound to every customer who responds. “Laptops starting at $400; visit our store for details” invites further interaction.

An advertisement becomes an offer when its language is clear, definite, and explicit, leaves nothing material open for negotiation, and indicates that acceptance will conclude the bargain. A stated quantity, a definite price or formula, a specified class of recipients, and a first-come or time-limited commitment can supply that indication. “One television, $200, first customer at the door Saturday at 9 a.m.; no rain checks” is much closer to an offer than “great televisions at low prices.”

A reward announcement is the principal near miss. A reward offer is ordinarily an offer to the public because it specifies the requested performance and promises payment upon completion. “$1,000 to the first person who returns our missing dog to the listed shelter by Friday” shows present commitment even though no individual offeree is named. The performer must generally know of the offer before performing and must complete the requested act under its stated conditions. A person who returns the dog without knowing about the reward has not acted in response to the offer and ordinarily cannot accept it afterward. A reward announcement asking people to submit ideas for possible consideration, by contrast, may be only an invitation to negotiate.

The distinction is not whether the communication reaches many people. It is whether the speaker has committed to a specified exchange with whoever satisfies the stated condition. A public sale advertisement usually asks customers to make offers; a definite reward announcement promises payment for the specified performance.

Goods transactions receive a further precision adjustment. Under UCC Article 2, an offer to buy or sell goods need not state every term that common law would expect. UCC 2-204 permits formation despite open terms when the parties intended to contract and there is a reasonably certain basis for giving an appropriate remedy. Price may be left open more readily than under common law, but the communication must still show present commitment rather than mere price discussion, and the quantity or scope of the undertaking generally must be ascertainable. Do not treat every incomplete goods advertisement as an offer; classify the communication first, then apply the Article 2 standard.

The UCC also treats a definite expression of acceptance differently from a conditional response when differing terms appear. Under UCC 2-207, “We accept your offer and suggest delivery on Tuesday” is not automatically a counteroffer merely because it proposes an added term. “We accept only if you agree to our delivery term” makes assent expressly conditional and operates as a counteroffer. The sibling chapter owns the broader acceptance mechanics; this distinction matters here because it determines whether the original power of acceptance survives.

Acceptance Power Ends in Different Ways: Trigger First, Consequence Second

After finding an offer, ask whether the power of acceptance was still alive when the offeree attempted to accept. Do not collapse all ending events into “revocation.” Each has a different trigger and sometimes a different requirement of communication.

Revocation by the offeror. Unless an applicable irrevocable-offer doctrine applies, the offeror may revoke before acceptance. A direct revocation requires communication to the offeree and is effective when received, not when the offeror privately decides to revoke or sends the message. An offeror’s statement to a reliable intermediary can suffice if the offeree receives it.

Indirect revocation requires both of these facts: the offeree obtains reliable information that the offeror took definite action inconsistent with the offer, and the action is sufficiently definite-for example, selling the subject matter to someone else. Mere preparation to sell, a secret change of mind, or an unverified rumor does not terminate the power. The offeror’s action must reach the offeree through a reliable source before acceptance.

Lapse. The power ends when the stated acceptance period expires. If no period is stated, it lasts only for a reasonable time, measured from the circumstances when the offer was made. The nature of the transaction, market fluctuation, the parties’ communications, and the method of response matter. A volatile commodity offer may lapse quickly; a proposal for a routine service may remain open longer. An offer made during a face-to-face conversation ordinarily lapses when the conversation ends unless the circumstances show an intended later response. A stated deadline does not itself make an offer irrevocable; it only identifies when the power ends.

Rejection. A rejection is the offeree’s communicated refusal to accept the offer. It terminates the power when received by the offeror. A private decision to reject has no operative effect until communicated. Mere silence, delay, or failure to respond is not a rejection and ordinarily does not terminate the power.

Counteroffer. At common law, a response that is conditional on the offeror’s assent to changed terms is both a rejection of the original offer and a new offer. “I will buy your car for $8,000 instead of $10,000” ordinarily rejects the $10,000 offer and proposes a new bargain. A mere inquiry does not: “Would you take $8,000?” seeks information and leaves the original power alive. The decisive fact is whether the response objectively communicates refusal of the original terms or merely asks whether different terms are possible.

For goods, UCC 2-207 prevents a different-term response from automatically becoming a counteroffer. A definite and seasonable expression of acceptance can operate as acceptance even though it proposes additional or different terms. But language making assent expressly conditional on the offeror’s agreement to the new terms is not acceptance; it is a counteroffer.

Death or incapacity. Death or incapacity of the offeror or offeree generally terminates the power of acceptance even if the other party does not yet know. Thus, an offeree cannot accept an ordinary offer after learning that the offeror died, even if the stated deadline has not arrived. The principal qualification is an irrevocable offer such as an option: the offeror’s death or incapacity does not ordinarily terminate that protected power. The sibling chapter treats the mechanics of options and reliance; the point here is to recognize that death is an automatic ending event for an ordinary offer, not a revocation requiring notice.

The timing question is always comparative: which event occurred first-effective acceptance or effective termination? If revocation, rejection, counteroffer, lapse, or death ends the power before acceptance becomes effective, the later attempted acceptance cannot create a contract. The sibling chapter owns the general rules governing the manner and timing of acceptance, including the mailbox rule; apply those rules after this chapter identifies whether the power was still available.

Recurring errors to eliminate:

• Treating a definite advertisement as automatically nonbinding even when it promises a specified item to the first identified responder.

• Calling every request for a lower price a counteroffer when the wording merely asks whether the offeror would consider it.

• Treating revocation as effective when sent rather than when received.

• Treating a stated acceptance deadline as a promise to keep the offer open.

• Treating death as a revocation that requires notice instead of an automatic termination of an ordinary offer.

One Item Under Time Pressure: Inquiry Before Revocation

A services transaction keeps the analysis under common law and isolates the difference between an inquiry, a counteroffer, and revocation.

On May 1, Painter offered by email to paint Client’s portrait for $10,000.

The email stated, “Please accept by May 10.”

On May 5, Client replied, “Would you take $9,000?”

On May 7, Painter emailed, “I withdraw my offer,” and Client read the email that afternoon.

On May 8, Client emailed, “I accept the $10,000 offer.”

Three Short Drills: Separate the Trigger from the Consequence

High-Yield Points - ⚡ Biggest Takeaways

Treat assent and offer status objectively: present commitment, not secret intent, controls. A clear reward promise can be an offer to the public; an ordinary advertisement usually invites offers. Separate revocation, lapse, rejection, counteroffer, and death by trigger, communication requirement, and timing.