Week 2

Topics: Real estate, Insurance, Contract Pages: 2 (796 words) Published: April 10, 2012
10.7 Acceptance (“A manifestation of assent by the offeree to the terms of the offer in a manner invited or required by the offer as measured by the objective theory of contracts.” (Section 50 of the Restatement (Second) of Contracts. An act that occurs when a buyer or lessee takes any of the following actions after a reasonable opportunity to inspect the goods: (1) signifies to the seller or lessor in or by conduct that the goods are conforming or that the buyer or lessee will take or retain the goods despite their nonconformity or (2) fails to effectively reject the goods within a reasonable time after their delivery or tender by the seller or lessor. Acceptance also occurs if a buyer acts inconsistently with the seller’s ownership rights in the goods. ) Peter Andrus owned an apartment building that he had insured under a fire insurance policy sold by J. C. Durick Insurance (Durick). Two months prior to the expiration of the policy, Durick notified Andrus that the building should be insured for $48,000 (or 80 percent of the building’s value), as required by the insurance company. Andrus replied that (1) he wanted insurance to match the amount of the outstanding mortgage on the building (i.e., $24,000) and (2) if Durick could not sell this insurance, he would go elsewhere. Durick sent a new insurance policy in the face amount of $48,000, with the notation that the policy was automatically accepted unless Andrus notified him to the contrary. Andrus did not reply. However, he did not pay the premiums on the policy. Durick sued Andrus to recover these premiums. Who wins? J. C. Durick Insurance v. Andrus, 139 Vt. 150, 424 A.2d 249, Web 1980 Vt. Lexis 1490 (Supreme Court of Vermont) 11.4 Preexisting Duty (Something a person is already under an obligation to do. A promise lacks consideration if a person promises to perform a preexisting duty.) Robert Chuckrow Construction Company (Chuckrow) was employed as the general contractor to build a Kinney Shoe Store....
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