Solution manual

ANSWER KEY

Chapter 8 Offer, Acceptance, and Mutual Assent

Opening Case Questions

2. Time was not “of the essence in this case. There are several reasons for reaching this conclusion.

(a) In the first place, none of the documents, not the offer, not the agreement, not Addendum A, used

the phrase “time is of the essence.” (b) In the second place, neither Andisman nor Blakeley made any

5. The fact that neither defendant signed the original offer makes no difference in this case. This is

because the Restatement of the Law of Contracts permits the court to examine a series of documents to

find the terms of the contractual arrangement. In this case, Andisman had signed Addendum A and

A QUESTION OF ETHICS -1

Questions for Review and Discussion

1. Mutual assent arises when both (all) the parties to a contract know the terms of the contract and

their duties under the agreement and have expressed a willingness to go along with those terms and

3. The UCC permits certain information to be omitted from an offer. Specifically, UCC 2-204 states

“even though one or more terms are left open, a contract a contract for the sale does not fail for

5. Under the mirror image rule, the terms as stated in the acceptance must exactly “mirror” the terms

in the offer. If the acceptance changes or qualifies the terms in the offer, it is not an acceptance. Instead,

terms of the original offer are changed. No agreement is reached unless the counteroffer is accepted by

the original offeror. The UCC has altered the mirror image rule when contract negotiations are being

8. To destroy mutual assent on a claim of fraud, the complaining or innocent party must prove the

existence of five elements. First, the complaining party will have to show that the other party made a

false representation about some material fact (i.e., an important fact, a fact of substance) involved in the

contract. A material fact is one that is very crucial to the terms of the contract. Second, it must be

shown that the other party made the representation knowing of its falsity. Third, it must be shown that

9. A mistake made by only one of the contracting parties is a unilateral mistake and does not offer

sufficient grounds for rescission or renegotiation. When both parties are mistaken, it is a bilateral or

mutual mistake. A bilateral or mutual mistake allows a rescission by either the offeror or the offeree. A

10. Physical duress involves either violence or the threat of violence against an individual or against

Cases for Analysis

1. The e-mail is not a legally effective offer. The terms are much too indefinite. The e-mail does

not specify which of Triple R-Bar’s acres Lindbergh-Sikorsky wants to purchase. Nor does it

specify a set price per acre. If there were a breach of contract, the court would not know how to

2. No, Sailors’ Maritimes refusal to pay was not correct. The court ruled this scenario to be a

unilateral agreement and that their performance in remaining with Sailors’ Maritime constituted

3. Jameson’s silence can be acceptance in this case. In effect, Jameson agreed that whenever she

5. No. This ad was not an offer. Rather, it was an invitation to trade. In this case, the ad did not limit

the sale of the Volvo to one particular person. Rather, the offer was open to anyone who appeared at

6. Yes. Since Thoelke had used the same agent (the U.S. mail) to accept as Morrison had used to

3. Yes. This situation clearly involves economic duress. The court ruled that the price

END CHAPTER EIGHT