Offer and Acceptance

Section 6-1
What is a contract?
 A contract is an agreement between 2 or
more parties that creates a legal
obligation
6 Requirements to Contracts
1. Offer and Acceptance
• Must be a genuine offer and the offer must be accepted without
changing the offer
• Person giving the offer is the offeror; person receiving the offer is
the offeree.
2. Genuine Assent
• The offer cannot be based on someone tricking someone else or
putting unfair pressure on them to accept the offer
3. Legality
• What the 2 people agree to must be legal
4. Consideration
• Both people in the contract must receive something of value
5. Capacity
• Must be 18 to have the capacity to contract
6. Writing
• Some, but not all, agreements must be in writing to be enforced
What is an offer?
 An offer is a
proposal by an
offeror to
something, provided
the offeree does
something in return.
Requirements of an Offer
1. Contractual intent must be present in
the offer.
2. The offer must be communicated to the
offeree.
3. The essential terms of the offer must be
complete and definite.
Requirements of an Offer:
#1 Contractual Intent Must be Present

 If you are joking but someone thinks you are

making an offer, then the law will hold you to the
offer.
 If you make a statement out of anger or terror,
then there is no legal offer.
 Ads in the newspaper are often invitations to
negotiate, not offers.
 Social agreements, or arrangements between
friends to do something, are not offers.
Requirements of an Offer:
#2 Offer Must be Communicated to 3rd Offeree

 A person who is not the intended offeree

CANNOT accept the offer. In other
words, if it wasn’t meant for you, you can’t
accept it.
 An public offer for a reward cannot be
accepted by someone who did not know
about the reward.
Requirements of an Offer:
#3 Essential Terms Must be Complete and Definite

 Complete:
◦ Identity of the item
◦ Price
◦ Full terms of payment
◦ Date for delivery of possession
◦ Date for delivery of the deed
 Definite:
◦ Everything must be specific and clear
◦ Cannot say “My car”, must say “My 2007 Jeep Cherokee”
Review
 What are the 6 requirements to
contracts?
 What are the 3 requirements of an offer?
 What is the difference between the
offeror and the offeree?