THE AGREEMENT

3551 Words Apr 16th, 2013 15 Pages
SECTION 2: THE AGREEMENT

An agreement is the essence of every contract. The parties to a contract are the offeror (who makes an offer) and the offeree (to whom the offer is made). If, through the process of offer and acceptance, an agreement is reached, and the other elements are present (consideration, capacity, legality), a valid contract is formed.

KEY VOCABULARY
Material:
Subject (matter):
Offeror:
Offeree:
Firm offer:
Party (parties):
Revoke:
Entitled:
Disclaim:

WARM-UP QUESTIONS: 1. Mistress Miller offers her first born child to Rumpelstiltskin, in return for a pile of gold. Miller says, “I promise you faithfully that I will leave the offer open for a week.” Three days later, before Rumpelstiltskin has made up
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If no time is specified, a reasonable time is implied. c. Rejection of the Offer by the Offeree An offer may be rejected by the offeree by words or conduct evidencing an intent not to accept. A rejection is effective on receipt. Asking about an offer is not a rejection. d. Counteroffer by the Offeree The offeree 's attempt to include different terms is a rejection of the original offer and a simultaneous making of a new offer. The mirror image rule requires the acceptance to match the offer exactly.
CASE STUDIES: 1. Fidelity Corporation offers to hire Ron to replace Monica, who has given Fidelity a month 's notice of intent to quit[11]. Fidelity gives Ron a week to decide whether to accept. Two days later, Monica signs an employment contract with Fidelity for another year. The next day, Monica tells Ron of the new contract. Ron immediately sends a formal letter of acceptance to Fidelity. Do Fidelity and Ron have a contract?

2. Owner offered to sell his house to Buyer for $200,000, the offer to be kept open for one week. A day after the offer was made, Buyer wrote to Seller, "I 'll give you $180,000." Owner did not respond. Before the end of the original one week
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