Explain briefly the law relating to communication of offer, acceptance and revocation. Is there limit of time after which an offer cannot be revoked?

 The law relating to the communication of offer, acceptance, and revocation forms the backbone of contract law, which governs the formation and enforcement of agreements between parties. This area of law is essential for ensuring the smooth functioning of commercial transactions and interpersonal dealings. Here, we'll delve into each aspect of this law, exploring its intricacies and the principles that underpin it.

Offer:

An offer is a manifestation of willingness to enter into a contract on certain terms, made with the intention that it shall become binding as soon as it is accepted by the person to whom it is addressed. It can be communicated through various means such as words, conduct, or in some cases, silence. For instance, if someone puts up a sign advertising a reward for the return of a lost item, it constitutes an offer to enter into a unilateral contract.

There are certain requirements for a valid offer:

1. Intention: The offeror must intend to create legal relations. Social invitations or statements made in jest are generally not considered offers.
2. Definiteness: The terms of the offer must be clear and definite. Vague or ambiguous offers may not be enforceable.
3. Communication: The offer must be communicated to the offeree or brought to their attention. It cannot be accepted if the offeree is unaware of its existence.

Acceptance:

Acceptance is the unqualified expression of assent to the terms of an offer. It must be communicated to the offeror in the manner prescribed or implied by the offer. The acceptance must be absolute and mirror the terms of the offer. Any attempt to vary the terms of the offer constitutes a counter-offer, which terminates the original offer.

For acceptance to be valid, it must meet the following criteria:

1. Communication: Like the offer, acceptance must be communicated to the offeror. Silence generally does not constitute acceptance unless there is a prior agreement or course of dealings between the parties.
2. Unconditional: Acceptance must be unconditional. Any attempt to add qualifications or conditions to the acceptance constitutes a counter-offer.
3. Mirror Image Rule: The acceptance must mirror the terms of the offer. If there are discrepancies between the offer and the acceptance, no contract is formed.

Revocation:

Revocation refers to the withdrawal of an offer by the offeror before it is accepted. The general rule is that an offer can be revoked at any time before acceptance, even if the offeror has promised to keep the offer open for a certain period. However, there are some exceptions and limitations to this rule:

1. Option Contracts: If the offeree gives consideration for a promise to keep the offer open for a specified period, the offeror cannot revoke the offer during that period.
2. Firm Offers: Under the Uniform Commercial Code (UCC), merchants can make irrevocable offers to buy or sell goods if the offer is made in writing and signed by the offeror, and it contains assurances that it will be held open.
3. Detrimental Reliance: If the offeree reasonably relies on the offer to their detriment, the offer may become irrevocable. This principle is known as promissory estoppel.
4. Start of Performance: If the offeree begins performance in response to the offer before it is revoked, the offer becomes irrevocable for a reasonable time to allow the offeree to complete performance.

Time Limit for Revocation:

As mentioned earlier, in most cases, an offer can be revoked at any time before acceptance. However, there is an exception known as the doctrine of option contracts. An option contract is a separate contract where the offeror promises to keep the offer open for a specified period in exchange for consideration from the offeree.

Consideration in the context of an option contract can be nominal, such as a token payment, or it can be something of value given by the offeree to the offeror. Once the offeree provides consideration and the option contract is formed, the offeror cannot revoke the offer during the specified period. If they do, the offeree may have a legal claim for breach of contract.

It's important to note that the time limit for revocation in option contracts is determined by the terms agreed upon by the parties. If the offeror attempts to revoke the offer before the expiration of the option period, it would constitute a breach of the option contract.

In conclusion, the law relating to the communication of offer, acceptance, and revocation is a fundamental aspect of contract law. It governs the formation of contracts and ensures clarity and certainty in commercial transactions. While offers can generally be revoked at any time before acceptance, there are exceptions such as option contracts, firm offers, and detrimental reliance. Understanding these principles is essential for both businesses and individuals engaged in contractual negotiations.

Subscribe on YouTube - NotesWorld

For PDF copy of Solved Assignment

Any University Assignment Solution

WhatsApp - 9113311883 (Paid)