Explore the legal terms and concepts related to Contract Formation. Click on any term below to learn more about its definition and applications.
What is the effect of a contract that is missing price terms?
Sale of real estate contracts are invalid if they are missing the price and description of land. Sal...
Though offers can generally be freely revoked, what are the 4 exceptions?
(1) An option contract, (2) a merchant's firm offer, (3) detrimental reliance, and (4) part performa...
What is required to form a valid, binding contract?
A valid contract requires: (1) an offer, (2) an acceptance, and (3) valid consideration
How may an offer be revoked?
An offeror may revoke their offer at any time before acceptance. Revocation is effective upon receip...
What is promissory estoppel?
A promise may be enforceable if it is necessary to prevent injustice. This occurs when: (1) the prom...
What are illusory promises and how do they affect a contract?
An illusory promise is occurs when only one party is bound to perform, and is unenforceable.
What are consideration substitutes?
Generally, a legally binding contract cannot be formed without consideration. However, a promise is...
Can partial payment of a debt be consideration for release of that debt?
If a debt is due and undisputed, partial payment is not valid consideration for release of debt. How...
Are pre-existing duties valid consideration?
Under the common law, generally, doing what you are already legally obligated to do is not new consi...
When is past or moral consideration valid?
Past or moral consideration is only adequate in 2 situations: (1) if a past obligation is not enforc...
What is the effect of a seller sending non-conforming goods?
If a seller ships non-conforming goods, it acts as both an acceptance and breach, unless the goods w...
What is the Mailbox Rule and when does it apply?
Under the Mailbox Rule, acceptances are generally effective when mailed. There are a couple exceptio...
Who controls the method of acceptance, and what are the typical ways that an offer is accepted?
The offeror controls the method of acceptance and whether the offeree must give notice that they hav...
What is acceptance?
Acceptance is a manifestation of assent to the terms of an offer.
What are the UCC Gap Fillers?
UCC Gap Fillers (1) Price: Reasonable price at time of delivery. (2) Place of Delivery: Seller's pl...
Under battle of the forms, what happens to different terms in an acceptance between two merchants?
There is no clear authority on this. Some courts treat different terms like additional terms, but ot...
Under battle of the forms, what happens to additional terms in an acceptance between two merchants?
Additional terms become part of the contract unless they: (1) materially alter its original terms; o...
Under battle of the forms, what happens to additional or different terms in an acceptance when at least one of the parties is a non-merchant?
Additional or different terms in an acceptance are mere proposals and the terms of the offer govern.
What is the effect of including additional or different terms to an offer?
Additional terms in a supposed acceptance trigger: (1) the mirror image rule under common law, and (...
What is the effect of a conditional acceptance on an offer?
A conditional acceptance terminates the original offer, and usually occurs where one party "accepts"...
What is the effect of a counteroffer on an offer?
A counteroffer generally terminates the original offer and creates a new offer. Where a counteroffer...
How can an offeree reject an offer?
An offeree can reject an offer directly by words or conduct, or indirectly via (1) a counteroffer, (...
What is the effect of part performance of a unilateral contract?
Start of performance pursuant to a unilateral contract offer makes the offer irrevocable for a reaso...
What is detrimental reliance?
An offer cannot be revoked if a party has relied in a way that is: (1) reasonably foreseeable, and (...
What is a merchant's firm offer?
Under the UCC, if (1) a merchant (2) offers to sell goods in a signed writing and (3) the writing as...
What is an option contract?
An option contract, under common law and UCC, is an offer that cannot be revoked. It is created when...
What is the effect of a lapse of time on an offer?
Offers can terminate either after a stated time or after a reasonable amount of time has passed.
When are price quotes valid offers?
Price quotes may be offers if they are sent in response to an inquiry.
What are requirement and output contracts?
Contracts for the sale of goods can state that the quantity of goods to be delivered is equal to eit...
What is consideration?
Consideration requires a bargained-for exchange of legal value.
What are the methods of terminating an offer?
Generally, offers create a power of acceptance within the person to whom the offer was made. If an o...
How do courts assess the adequacy of consideration?
Sham or token consideration is not sufficient, however, courts generally do not look into the adequa...
What are the requirements of an offer?
An offer requires: (1) the expression of a promise, undertaking, or commitment to enter into a contr...
What is a contract?
A contract is a legally enforceable agreement.
What is the effect of an offeree beginning to perform in response to an offer?
Generally, when an offeree starts performance, it is treated as an implied promise to perform and ac...
Are offers assignable?
Generally, offers are not assignable. Options can be assigned, unless the terms of the option state...
When are advertisements valid offers?
Advertisements are not offers, unless: (1) the offer is a reward (e.g., a unilateral contract); or (...
What is the effect of a contract that is missing quantity terms?
Sale of goods contracts must have a quantity term.
What is the effect of a contract that contains vague or ambiguous terms?
There is no offer where any of its material terms are vague or ambiguous.
What is the effect of the death of a party prior to acceptance of an offer?
If either party of an offer dies or becomes incapacitated after the offer but before the acceptance,...
