Consideration, Revocable Irrevocable Offers, Communication of Acceptance, Formal/Informal Contracts

Only available on StudyMode
  • Download(s) : 498
  • Published : February 23, 2013
Open Document
Text Preview
SAB 330
Week 8

PUBLIC POLICIES AND ECONOMIC ORGANIZATIONS

1) Explain term of “consideration”
The "consideration" requirement for creating a Common Law contract requires that both sides of the agreement give consideration. "Consideration" is the giving of bargained for legal value. The "bargained for" requirement means only that the legal value given is that which the other party requested, i.e. that there has been some communication about who gives or does what for whom. There is seldom, if ever, a problem with that part. The "legal value" part is somewhat more complex, and is usually the point of disagreements concerning consideration. "Legal value" does not mean that something has a particular market value or that the parties agree on its worth.

2) Give some example of “revocable offers” and “irrevocable offers” An offer is a manifestation of an intent to be contractually bound upon acceptance by another party. An offer creates in the offeree the power to form a contract by an appropriate acceptance. An offer may be revoked by any words that communicate to the offeree that the offeror no longer intends to be bound. An offer is also revoked by action that is inconsistent with the intent to be bound once the offeree learns of such inconsistent action. A revocation is effective upon receipt by the offeree.

An offer is irrevocable when: offeree gave consideration for an irrevocable / implied or express promise by the offeror not to revoke / relied to his detriment upon the offer itself /offeree began performance 3) Explain term of “communication of acceptance”

Acceptance is a final and unqualified expression of assent to the terms of an offer. There are several rules dealing with the communication of acceptance:

The acceptance must be communicated:
* An offer can only be accepted by the offeree, that is, the person to whom the offer is made.
 * An offer is not bound if another person accepts the offer on his behalf without...
tracking img