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Offer and Acceptance, and Some of the Resulting
Legal Relations
Arthur Corbin
Yale Law School
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YALE
YALE
LAW
LAW JOURNAL
JOURNAL
Vol. XXVI
XXVI
JANUARY, 1917
1917
JANUARY,
3
No.
No.3
OFFER AND
AND ACCEPTANCE,
ACCEPTANCE, AND
AND SOME
SOME OF THE
THE
OFFER
RESULTING LEGAL
LEGAL RELATIONS
RELATIONS
RESULTING
In the study and
and the practice
practice of the law,
law, our constant
constant problem
In
is: what legal
legal relations are
are the result
result of facts that occur; or,
starting from the other direction with
with a given set of legal rela(such as a contract, or a debt, or the
the ownership
ownership of
of land)
land)
tions (such
will operate
operate to cause
cause such a result?
result?
our problem is: what facts will
starting point; and indeed
-indeed for the best
One may take either starting
working forward
necessary to take both, alternately working
results, it is necessary
and back, correcting and amplifying our necessarily tentative
tentative
conclusions. In the present article, the starting
starting point will be
conclusions.
contractual relations
relations themselves, leading back
back to a considerconsiderthe contractual
ation of some of the facts and intermediate
intermediate relations that
various forms?
The term contract has been used without much discrimination
discrimination
(I) the series of operative
operative
to refer to three different things: (i)
acts of the parties expressing their assent and resulting in new
legal relations; (2) the physical document executed
executed by the
evidence
parties as an operative fact in itself and as the lasting evidence
of their having performed the necessary operative
operative acts; (3) the
relations resulting from the operative acts, consisting of a right
accompanied
or right in personain
personam and the corresponding duties, accompanied
of
by certain powers, privileges and immunities.
immunities.'1 Clearness of
an
see an
relations, see
of jural relations,
and classification of
1I For a masterly analysis and
article on
Legal Conceptions as Applied in Judicial
on Some Fundamental Legal
Reasoning, in 23
W. N.
N. Hohfeld
LAw JOURNAL,
JOURNAL, 16, by Professor 'V.
23 YALE LAW
of the Yale School of Law.
Law.
[i6]
13
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YALE LAW
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whenever the term is used, one particular
particular
thought requires that whenever
meaning
meaning should be consciously
consciously adopted
adopted and clearly expressed.
expressed.
convenient generally
generally to define
Very likely it would be most convenient
contract in sense (3),
(3), as the legal relations between persons
persons
arising from a voluntary
voluntary expression
expression of intention, and including
including
arising
at least one primary
primary right in personam, actual or potential, with
otherwise indicated,
its corresponding duty. Unless othenvise
the term
meaning. 22
this meaning.
with this
contract will be used herein with
given
In determining
determining whether
whether or not a contract exists in any given
were
What
case, one of our problems is historical in character.
the facts? What were the acts of the parties and the circumcircumthat surrounded
surrounded them? When these have been
stances that'
been ascertained the next step is analytical. Immaterial facts must be eliminated, and the rest must be classified as either
either evidential
evidential or
or
The. operative
operative. The,
operative facts are those that cause the existence
of those legal relations called a contract.
This analysis can only be made, and must be made, with
law of contract. This law is a part of the
reference to the Jaw
general
general legal system
system under which we live, enforced by the societal
which we are part. . What the rules of this
organization of 'which
society are, can be determined
determined only by induction from the judgments and decrees and pronouncements
pronouncements of the past. Under the
in
existing legal system no legal relation is deemed contractual
contractual in
-the part of two conconthe absence of certain voluntary
voluntary acts on ·the
tracting parties. What acts are those which will cause society
to come forward with its strong arm? They may well be
be
operative or causative,
described as operative
causative, for they are necessary
antecedents
antecedents to the creation of those legal relations and societal
societal
description of
definitions. "The
"The most
most popular
22 Compare
Compare the
following definitions.
the following
popular description
of
exact
one;
namely,
that it
it
be
given
is
also
the
most
a contract that can
can
exact
is a promise or set of promises which
which the law will enforce.
enforce. The
The specific
to
mark of a contract
contract is the creation of a right, not to a thing, but to
another
another man's conduct in the future." "Every
"Every agreement and promise
promise
Contracts (3d
ed.)
Wald's Pollock, COl/tracts
enforceable
enforceable by law is a contract."
contract." \Vald's
(3d ed.)
pp. 1,2.
1, 2.
A contract is "an agreement
agreement enforcible at law, made between
between two or
or
or
more persons, by which rights are acquired
acquired by one or more
more to acts or
Contracts (2d
(2d
forbearances on the part of the other
forbearances
other or others."
others." Anson, COlltracts
ii.
Am. ed., Huffcut)
Huffcut) p. II.
contractual relation
"The act alone is the contract, the resulting contractual
relation is
is
251.
See
(ioth ed.)
quite a different
different thing."
thing." Holland, Jurisprudence
Jurisprudel/ce (loth
ed.) p. 251.
See
i91.
classification, Works, III, 191.
also Bentham's classification,
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OFFER AND
AND ACCEPTANCE
OFFER
guaranty of
of compulsion
compulsion called
called contract.
contract. The analysis
analysis of
of these
these
guaranty
acts into offer
offer and acceptance,
acceptance, customarily
customarily made
made by
by writers
writers on
on
acts
contract law, is a convenient
convenient one.
contract
An offer
offer is an
an act
act on
on the part of
of one
one person
person whereby
whereby he gives
gives
another the legal
legal power of
of creating
c.reating the obligation
obligation called
called
to another
contract; An
An acceptance
acceptance is the exercise
exercise of
of the power
power conferred
conferred
contract.
the offer, by the performance
performance of
of some
some other
other act or acts. Both
Both
by the
offer and
and acceptance
acceptance must be acts expressing
expressing assent.
offer
act constituting
constituting an offer .and
act constituting
constituting an
and the act
The act
acceptance may
may each
each consist in
in a promise.
promise. A promise is an
acceptance
expression of
of intention
intention that the promisor
promisor will conduct
conduct himself
himself
expression
specified way in the future, with
with an invitation
invitation to the promisee
promisee
in a specified
If only
only one
one of the
the acts has this character, the
to rely thereon. If
contract is unilateral.
unilateral. If
If both
both acts have
have this character,
character, the
contract
contract is bilateral.
bilateral. If
If neither
neither of
of the acts has
has this character,
character,
contract
new set of
of legal relations,
relations, if any exist, is not
not called
called obligation.
obligation.
the new
contract in sense (3)
(3) adopted
adopted above,
In such case there is no contract
although there may be one
one in either of the other senses. Each
of these three cases will be discussed below.
below. In none of these
these
unless the acts
expected legal relations be created unless
cases will the expected
of the parties comply with the rules
rules relating
relating to mutual
mutual assent,
consideration, form, capacity
capacity of parties, and legality of object.
consideration,
Only certain
certain rules relating
relating to mutual
mutual assent
assent will be considered
considered
here.
BARTER
BARTER
A mutual, present
present exchange of
of laQds
chattels creates
creates no
lands or chattels
has
B
contractual duty. If
A
has
apples
to
sell
and
money, A
If
-B may accept by
may offer the apples to B for the money. ·B
transaction
delivering to A the possession of the money. Such a transaction
is a barter. The character
character of the commodities
com~odities exchanged
exchanged is not
not
new
physical
creates
transaction
material. Such a
physical relations, and
organized society it creates new legal relations. These new
in an organized
relations arise by the voluntary
voluntary action and consent of the two
parties, but there is no special right in personam.
personam. There is a
documentary bill of
contract
sense (I)
of
(i) described above, and a documentary
contract in sense
(2), but there is no contract
contract in sense (2),
sale would be a contract
contract
"belong" to
(3). After such a transaction
in sense (3).
transaction the apples "belong"
B and the money to A; this means that organized
organized society has
created numerous legal relations
relations between
between each party and every
other member of society. A and B are said to have rights in rem,
a term that is useful even though likely to mislead some into
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YALE LAW
YALE
LAW JOURNAL
res. The
thinking that such a right is a physical relation to the res.
legal relations created
created are not special
special relations between
between A and B;
B;
independence of
they involve all persons alike, and exist in total independence
of
If after the transaction A
their voluntary action
action or consent. If
should forcibly deprive B of the apples sold to him, he is comcommitting no different
different wrong from that committed by X if he should
should
do the same, and he is subject
subject to no different penalties.
penalties. After
After
such a transaction
transaction the legal relations between
between A and B, arising
arising
by their consent, are precisely
precisely like the legal relations existing
between X and B, although X has consented to nothing. Such a
executed contract, but it is better
transaction is often called an executed
better
described as a barter or an exchange
exchange of goods.
GIFT
If A has lands or chattels and executes a gift to B, which
If
B accepts, there are acts of offer and acceptance
acceptance and there
there is
contractual obligation is created. As in the
mutual assent, yet no contractual
or
case of aa barter, the only rights involved
involved are property
property rights or
rem. The only duties created are those general duties,
rights in
in rem.
binding upon non-participating
non-participating persons as well as upon A. No
rein and B's
special right in personam
personam is created.
created. A's rights in rem
B's
former duties are extinguished,
extinguished, and in lieu thereof similar rights
created in B and similar duties devolve upon A. The same
are created
same
may be said of their respective privileges, powers, immunities,
and their correlatives.
correlatives. Thus, there are new legal relations,
arising from voluntary
voluntary acts of offer and acceptance. and such acts
would fulfil the first definition
definition of a contract
contract given above. A
paper "deed
"deed of gift"
gift" would satisfy the second
second definition.
definition. The
resulting legal relations, however, should not be described as
contractual,
(3). All other
contractual, according
according to definition (3).
other persons, and
not merely A and B, are parties to these new relations.
CONTRACT
If A has apples (or
If
(or land)
land) to sell, and B
B has no money, a
barter of apples for money is not possible; but A may be willing
willing
to deliver his apples to B in return
return for B's promise to pay
in-the future. If
If B agrees to this, receives
money in·
receives the apples and
promises to pay the money, a new physical relation exists as to
the apples but not as to the money. As in the case of barter.
or gift, society
society creates numerous relations
relations between
between B and all
other persons; as to the apples, he has rights in rem against
against such
such
other persons. B's rights are property rights and not contract
contract
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OFFER AND ACCEPTANCE
ACCEPTANCE
OPFER
173
rights. But the
the position of A
A is very
very different
different from that of
rights.
barter. A
A has no money, and
and no rights in rem,
ren, good as against
against
third
persons
who
are
not
consenting;
but
a
promise
has
third persons
not consenting; but
has been
made
to
A
by
B,
the
fulfilment
of
which
is
commanded
by
made
of
is
organized
society.
If
B
fails
to
keep
his
promise,
society
will
at
organized
If fails to
his
society
at
A's
request
exercise
compulsion
against
B,
but
will
exercise
A's request exercise compulsion against
exercise
compulsion against no other person. Special legal relations exist
exist
between A
A and B, A having aa claim against B ·that
-that he has
betw'een
against no other person, and B having a duty that rests upon no
other person. These relations, with certain others that will not
here be discussed,3
discussed,3 constitute the obligation; and since they arise
from expressions
expressions of mutual consent, they are
are contract.
contract. A's
special right against B is called a right in
in personam.
personam.
UNILATERAL AND
AND BILATERAL
BILATERAL CONTRACTS
CONTRACTS
UNILATERAL
If the acts of A and B are
are such as to create a right or rights in
If
personam,
personam, actual or potential, in favor of A and against B, but
no such right in favor of B against A, the contract
contract is called
unilateral.
If they create mutual rights in personam
unilateral. If
personam with their
their
bilateral. It has sometimes
corresponding duties, the contract is bilateral.
it
been said that a contract must be binding on both parties or that it
is binding on neither, that mutuality of obligation is required;
but
required; but
this is a loose and inaccurate
inaccurate statement. It
It has no application
contracts. 44
unilateral contracts.
of unilateral
case of
the case
in the
whatever
whatever in
(I) If
If A makes a promise in writing to pay B $100
$Ioo and signs,
(I)
seals, and delivers the document, a unilateral obligation
obligation is created.
It
creates
a
duty
resting
on
A
and
a
right
possessed
It
possessed by B.
(2)
If
A
accepts
a
bill
of
exchange
drawn
upon him by B in
in
(2) If accepts
exchange
33 They
They are, however, of vital importance, both practically
practically and logically.
See Hohfeld,
cit. note I,I, supra.
supra.
lac. cit.
Hohfeld, loc.
44 Courts
very frequently
frequently use
use the
the term "unilateral"
Courts very
"unilateral" to refer to a promise
promise
that
that is without
without consideration,
consideration, especially in those cases where mutual
promises have been given, but one of them is illusory: as where A
offers a promise to carryall
carry all the milk that B may care to ship, at fixed
accepts the offer and promises to pay those rates for all
rates, and B accepts
milk shipped by him with A. It
prevailing
It is not unlikely
unlikely that this is the prevailing
usage, but it is illogical and should be abandoned. Both A and B have
made promises,
promises, but neither promise has resulted in either a right or a
an
obligation, unilateral or otherwise.
otherwise. A has made an
duty. There is no obligation,
offer and perhaps
perhaps B
B still has a power of acceptance.
acceptance. This one new relarelation
be described
as unilateral;
unilateral; but the same
any
tion might
might be
described as
same may be said of any
offer, and
and it is not customary
customary to do so. See
See Morrow
Morrow v. So. Express Co.
(1897)
ioI Ga.
Walker (1913)
6;
(1897) 101
Ga. 8io;
810; Rehm-Zeiher
Rehm-Zeiher Co.
Co. v. Walker
(1913) I56
156 Ky. 6;
Anterican
(19oo) 94 Ill. App.
AlIlericalt Refrig.
Retrig. Co. v. Chilton (1900)
App. 6.
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174
YALE LAW
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YALE
favor of
of C,
C, aa right
right springs
springs up
up in
in CC and
and aa duty
duty rests
rests on
on A.
A. This
This
favor
and
C
is
unilateral.
obligation
between
A
obligation between A and C is unilateral.
(3) IfIf A
A gives
gives to
to BB his
his IIOU
in return
return for
for money
money loaned
loaned by
by
0 U in
(3)
B,
there
is
a
similar
unilateral
contract.
B, there is a similar unilateral contract.
(4) IfIf BB offers
offers to
to A
A aa conveyance
conveyance of
of property
property in
in land
land or
or
(4)
isis
chattels
for
a
promise,
and
the
offer
is
accepted,
the
contract
contract
the
chattels for a promise, and the offer is accepted,
is
yours
horse
For example,
example.. B
B says
says to
to A,
A, "This
"This black
black horse is yours
unilateral. For
unilateral.
as he
he stands
stands in
in return
return for
for your
your promise
promise to
to pay
pay me
me $Ioo
$100 in
in
as
30 days."
days." A
A replies,
replies, "I
"I accept."
accept." This
This is
is an
an executed
executed sale
sale on
on
3o
credit without
without warranty.
warranty. B's
B's offer
offer confers
confers upon
upon A
A the
the power
power
credit
promise.
to
make
the
horse
his
own
by
making
the
requested
promise.
to make the horse his own by making the requested
No duty,
duty, special
special to
to himself,
himself, rests
rests upon
upon the
the offeror,
offeror, and
and the
the offeree
offeree
No
in
gets
no right
right in
in personam.
personam. The
The offeror
offeror gains
gains aa right
right personam
personam
gets no
and the
the offeree
offeree gets
gets instantly
instantly certain
certain right
right in
in rem.
rem.
and
(5) A offers
offers aa promise
promise of
of aa reward
reward of
of $ioo
$roo to
to anyone
anyone who
(5)
will
arrest X.
X. B,
B, with
with knowledge
knowledge of
of this
this offer
offer and
and with
with intent
intent
will arrest
once
at
accept it, arrests X.
X. A unilateral
unilateral obligation
obligation at once arises.
arises.66
to accept
(6) A writes
writes to
to B, "Ship
"Ship me 2 cars
cars XX
XX flour via B.
B. & 0.,
0.,
(6)
once, price
price $io
$10 per
per bbl.
bbl. COD."
C.O.D." BB ships
ships at
at once
once as.
asat once,
requested.17
requested.
«7) A sends
sends his brother
brother to B with the following
following letter
letter of
of
((7)
credit.. "Let
"Let Harry
Harry have
have $ioo
$100 and I will
will guarantee
guarantee repayment
repayment
credit,
days." B advances
advances $ioo
$100 as requested.
requested.8s
30 days."
in 30
(8) A promis'es
pay him a salary at the rate of $Io,ooo
$10,000
promises B to pay
(8)
a year for B's services
services as superintendent.
superintendent. B may recover
recover at the
specified rate for such service
service as he thereafter
thereafter renders, but the
the
specified
9
will.'
hiring is a hiring at will.
-
Sunmary, sec.
(N. Y.)
Y.) 103. Langdelt,
Langdell, Summar)',
(183o) 6 Wend. (N.
Frith (1830)
5 Mactier
Mactier v. Frith
14, suggests
suggests that in this case no promise
promise was necessary, because
because a debt
would arise on Mactier's
Mactier's acceptance
acceptance of the brandy;
brandy; but the writer
writer believes
believes
would
that such an acceptance
necessarily involves
involves a promise to pay, in fact,
acceptance necessarily
and that without such a promise the offeror
offeror did not intend title to pass.
Williams v.
61o; Williams
60 See Williams v. West Chi.
Chi. St.
Ry. (1901)
(19Ol) 191 Ill. 610;
St. Ry.
(1887) 79 Ga. 658;
& Ad. 621; Biggers
658;
Carwardine
Biggers v. Owen (1887)
(1833) 4 B. &
Carwardine (1833)
S/me'jl
•
(875) 92 U. S. 73.
U. S.
S. (1875)
v. U.
Shucy v.
Co.
Mill Co.
Wind Mill
Challenge Wil~d
44; Challenge
J. 44;
Cr. & J.
(1831) 22 Cr.
Benson (1831)
Wood v. Benson
77 See Wood
(1869)
v. Kerr
(18g2)
93
Mich.
328;
Wheat
v.
Cross
Cross
(1869)
31
Md.
99.
328;
Kerr (1892)
(1898)
v. Murphy
Lennox v.
362; Lennox
Mass. 362;
2o4 Mass.
(igio) 204
v. Clark
Clark (1910)
Lascelles v.
88Lascelles
Murphy (18g8)
v.
Bishop v.
S.) 133; Bishop
(U. S.)
Dall. (U.
(1793) 44 Dalt.
Niell (1793)
Eddowes v. Niell
171 Mass.
Mass. 370; Eddowes
S.)
C. B.
B. (N. S.)
Eaton
12 C.
(1862) 12
v. Davies
Davies (1862)
(1894) 161 Mass. 496; Offord v.
Eaton (18g4)
748.
9
Hassard
v. Hassard
Harperv.
9 Martin
148 N. Y. 117; Harper
(1895) 148
Co. (18g5)
Ins. Co.
Y. Life Ins.
v. N. Y.
Martin v.
Orr v.
v.
ii; Orr
43 Minn.
Minn. II;
(i8go) 43
v. Smith
Smith (1890)
(1873)
Stensgaardv.
187; Stensgaard
113 Mass. 187;
(1873) 113
Ward
73 Ill.
Ill. 318.
(1874) 73
Ward (1874)
6
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OFFER AND ACCEPTANCE
OFFER
175
It has been said that unilateral contracts are made either by
It
an offer of a promise for an act or by an offer of an act for
10
a promise.10
This means, although the descriptive words are not
right
exact, that the single duty may rest on the offeror, the right
being
oeing in the offeree,
offeree, or vice versa. The words are inexact,
because
promise is itself
itself an act. All offers are
because the making
making of a promise
acts and all acceptances
acceptances are acts, whether the resulting legal
relations
constitute a
relations are property
property as in the case of a barter, or constitute
contractual obligation, either unilateral or bilateral. In example
(i) above, the offeror makes a proI!1ise
promise and undertakes a duty,
(I)
but he requests
requests no act whatever as an equivalent. The only
act on the part of the offeree is such an act of acceptance
acceptance of the
physical document as may be necessary
necessary to constitute a legally
legally
effective delivery by the offeror. The duty is on the offeror.
(2), C makes the offer when he presents
In example
example (2),
presents the bill
confers upon A the legal
to A for acceptance. He thereby confers
'binding himself
himself alone to pay a sum of money. In
power of 'binding
presenting the bill C does an act,
act, but he is not offering this act
act
as the legal equivalent and agreed return for A's promise. There
offeror
is no offer of an act for a promise, but the act of the offeror
was necessary
necessary before
before the offeree could undertake the duty.
(3) is a case where it does hot clearly appear which
Example (3)
If A offered
0 U to be accepted by a
offered his IIOU
one made the offer. If
If
transfer of money, it was an offer of a promise for an act. If
I 0 U, the
B offered a transfer of the money in return for the IOU,
(4), except
example (4),
except that there is paper
paper evidence
case is just like example
of A's promise.
Example
Example (4) is a case where the duty is assumed by the
offeree.
offeree. B's act has been
been unhappily
unhappily described as an offer of an
act for a promise. B does indeed do an act when he makes the
offer just as any offeror
offeror must necessarily do; but he does not
not
offer the act, he does the act. This act is completely
completely performed
performed
even before A hears of it and perhaps
perhaps long before A makes his
promise. This act, regarded as in itself the consideration
consideration for
for
A's
promise,
would
be
past
consideration.
The
effect
of
B's
act
A's promise, would
act
in making
create new
making the offer is to confer upon A a power to create
legal relations. It
It produces this effect instantly
instantly and in so doing
doing
is wholly
exhausted.
The
exercise
of
this power requires
requires no
wholly
further act upon B's part; it requires merely acceptance
acceptance by
by
A. The legal
effect
of
this
acceptance
is
the
instant
extinction
legal effect
acceptance
10 Anson,
Anson, COl/tracts
Contracts (2d
Huffcut) sec.
22.
(2d ed.,
ed., Huffcut)
sec. 22.
10
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YALE LAW
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of B's rights in rem and other
other property relations
relations in respect of
of
the horse and the creation in A of similar rights and relations.
consideration for A's promise
The consideration
promise is this substitution of rights,
and it is this substitution
substitution that is offered in return
return for the one
right in personam
personam to be created
created by A's promise.
(6) and (7)
(7) are all cases where a promise is
(5), (6)
Examples (5),
offered
offered for an act. That is, A by promissory words gives to B
personam as against
the power
power of creating in himself a right in
in personam
against
(5)
A by doing an act or acts which A desires
desires to be done. In (5)
affecting the physical and legal relations of X, a
this act is one affecting
third party. In (6)
(6) B's act effects
effects a substitution
substitution of property, A
becoming
becoming owner of the flour. It also
also effects a physical change
(7) B's act confers property
in the location
location of the goods. In (7)
in
It gives B in
property in B. It
upon Harry, and extinguishes such property
enforcible after 30 days.
return a right in personam
personam against A, enforcible
A bilateral contract
contract is made in exactly
exactly the same way as is a
unilateral contract
contract or a barter. The offeror does an act conferring a power upon the offeree, and the offeree
offeree does the. act
that constitutes the exercise of the power. The legal result,
however, is a relation consisting of mutual rights and duties,
special and personal in character. The following are examples
examples of
of
contracts:
bilateral contracts:
bookkeeper for
(9)
(9) A says to B, "I promise to serve you as bookkeeper
for
one month in return for your promise to pay me $ioo."
$100.·' B
replies, "I
"I accept."
accept."
Blackacre to you
(IO)
(10) A writes to B, "I promise to convey Blackacre
June 1st
$1,000 at that
Ist in return for your promise to pay me $I,ooo
on June
time. You may accept by cable, using the one word
word 'Blackacre'."
'Blackacre'."
"Blackacre," as requested.
B sends the cable despatch "Blackacre,"
In case (9)
(9) the acts of offer and acceptance
acceptance are oral promissory
(io) the offer is the act of writing
words. In case
case (10)
writing and the
further acts whereby this writing is brought
brought to the offeree. The
acceptance
acceptance consists of acts by B, whereby he directs the cable
cable
These acts by B
"Blackacre."
company
company to transmit the word "Blackacre."
$i,ooo, but
would not customarily
customarily amount
amount to a promise to pay $1,000,
in this case
case they do become such a promise because
because A will so
interpret them and B knows it. In the same way any other
other act,
in itself meaningless, may be specified
specified and may thereby become a
return promise.
It is not always
always an easy matter
matter to determine whether a contract
Frequently, this determination
or
bilateral.
is in fact unilateral
unilateral
-determination
especially where the offeror has
will have very important results, especially
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OFFER AND
AND ACCEPTANCE
ACCEPTANCE
OFFER
attempted to
to revoke
revoke his
his offer
offer as
as explained
explained elsewhere.
elsewhere. The
The form
form
attempted
of
words
used
by
the
parties
is
not
at
all
conclusive,
when
when
conclusive,
is
not
at
all
the
parties
used
by
of words
examined out
out of
of their
their setting
setting and
and with
with the
the aid
aid of
of nothing
nothing but
but a
examined
dictionary.
The
meaning
of
words,
as
used
by
the
parties
to aa
to
the
parties
by
as
used
of
words,
dictionary. The meaning
contract,
cannot
be
determined
with
mathematical
certainty;
and
and
certainty;
mathematical
contract, cannot be determined with
the judge
judge who
who is
is most
most certain
certain to
to do
do injustice
injustice is
is the
the pedant
pedant who
who
holds contractors
contractors to
to meticulous
meticulous accuracy
accuracy in
in the
the usage
usage of
of words
words
and in
in the construction
construction of
of sentences."
sentences.l1
It can
can hardly
hardly be
be said
said that
that courts
courts are
are often
often pedantic
pedantic in
in this
this
It
is possible
possible that professors
professors of
of law
law may be.
be. The
The
though itit is
matter, though
distinction between
between unilateral
unilateral and
and bilateral
bilateral is
is not
not even
even yet
yet very
very
distinction
thoroughly grasped by
by the multitude
multitude of
of lawyers,
lawyers, a fact which
which
thoroughly
leads -them to
to repeat
repeat again and
and again
again the
the erroneous
erroneous statement
statement
leads
one cannot
cannot be
be bound
bound unless the
the other
other is bound. The
The judges,
judges,
that one
therefore, are not in
in general
general too likely
likely to
to hold
hold that
that a proposed
proposed
therefore,
12
contract is unilateral
unilateral when
when the parties meant
meant it
it to
to be
be bilateral.
bilateral.12
contract
11""The
""The logic of
of the
the portion
portion of the opinion
opinion .
. . . ..above
above quoted,
11
the standpoint
standpoint of
of the grammarian
grammarian and
and verbal 'precision,
unassailprecision, is unassailfrom the
able-; but it may be
be questioned whether
whether so literal, narrow, and technical
technical
able;
construction ought
ought to be
be put
put upon
upon such
such an ordinary business communicommunia construction
Bau11lal~ v. McManus
McMallus (1907)
(1907) 75
75 Kan. io6.
106. "In interpreting
interpreting a
cation." Bauman
cation."
declaration
real intention is to be looked for and
and it is
is
declaration of intention, the real
not to be tied
tied to the literal sense of the expre~sion."
German Civil Code,
expression." German
not
sec. 133.
133.
12 "Whenever
"Whenever circumstances
circumstances arise
12
arise in the ordinary
ordinary business of life in
were ordinarily
ordinarily honest
honest and,
careful the one of them
which if two persons were
and careful
which
would make a promise
promise to the
the other, it may properly
properly be
be inferred
inferred that both
both
would
of them understood that such a promise was given and accepted."
accepted." Ex
parte Ford
Ford (1885)
(1623) Cro.
InMapes v. Sidney (x623)
(885) 16 Q. B. D. 305, 307. In
parte
plaintiff
Jac. 683, the defendant promised
promised to pay the debt of J. S. to the plaintiff
in consideration
consideration that the plaintiff
plaintiff would forbear to sue J. S. Plaintiff
Plaintiff
alleged that he forbore per
magnum tempus. Winch and Hutton, J.J.,
per 11Iagnu11I
thought this bilateral, the plaintiff
plaintiff having promised to forbear forever.
Hobart, c.J.,
C.J., thought it unilateral, but that the plaintiff had forborne
sufficiently for acceptance;
acceptance; he said, "without express words he is not
chargeable by promise." Similar contracts were held to be bilateral in
1626)
Theme
v. Fuller
(1616) Cro. Jac. 396; Cowlin
Cowli,~ v. Cook
(about 1626)
Cook (about
Fuller (1616)
Therne v.
Latch, 151. That Mr. Justice Holmes is not unwilling to discover the
implication
promise on evidence that seems not any too strong, see
implication of a promise
(igoi) 179
v. Meles
Meles (1901)
Wheeler
Klaholt (1901)
Martin v.
Mass. 141; Martin
178 Mass.
(igoi) 178
Wheeler v. Klaholt
Mass. 114.
114.
Where a promise is
offeror, with a proviso or condition
the offeror,
given by the
is given
not only
offeree, not
attached, the fulfilment of
of which requires action by the offeree,
for
is it frequently inferred
inferred that such action is the intended consideration for
the
the promise but it is also inferred that the offeree has promised that ~e
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Suppose
$5,ooo for Blackacre,"
Suppose A writes to B, "I will pay you $5,000
and B replies, "I accept
accept your offer."
offer." This seems to be bilateral,
bilateral,
and it is too late for A to revoke. A clearly makes a promise to
pay money; and, according to the ordinary
ordinary understanding
understanding of
of
mankind, he requests
m~nkind,
requests B to make a return promise to convey
convey the
land. But if A has asked an actual conveyance
conveyance of Blackacre
Blackacre as
the equivalent
equivalent of his promise, there
there is no contract at all, and A
may revoke.
(8) above, some courts have found in the words
In example
example (8)
of the parties
parties a promise by A to pay to B a year's salary and a
return promise
promise by B to serve for a year. In such case the hiring
hiring
is not at will, but for a year; and this despite3 the fact that there
sort.1
that sortP
are no express promissory words
words of
of that
In example (6)
(6) above, it has often been held that the offeree
offeree
may accept by mailing
mailing a letter containing a promise to supply
supply
"acceptance of the order,"
order," and that a revocation
the goods-an
goods-an "acceptance
acceptance is too late, even though the goods are not
after such acceptance
not
yet shipped.'
It must not be assumed
shipped.144 It
assumed too readily
readily that an order
order
for goods is an offer of a promise in return for title to the
goods to be effected
effected by the act of shipment or otherwise. The
offeror frequently wishes a return
return promise, as the offeree
offeree understands. The language
language used may be elliptical, and understood
understood
to be so.
EXPRESS, IMPLIED, AND TACIT CONTRACTS
CONTRACTS
EXPRESS,
A brief definition
An express
definition of these terms will suffice here. .-\n
contract
-to exist when the acts of the parties
declaring
contract is said -to
parties declaring
tacit
their will and intention
intention are spoken
spoken or written
written words. A tacit
contract
sufficient
contract is any other kind, the acts of the parties being sufficient
action shall take place. Dtmton
Dunton v.
114;
'lJ. Dunton
DUllton (1892)
(18g2) 18 Vict.
Viet. L. R. II4;
Jamieson v. Renwick (1891)
v. Atlas Mut. Life
Jamieson'lJ.
(1891) 17 Vict.
Viet. L. R. 124; Lewis
Lewis'lJ.
Life
Ins.
(1876) 61 Mo. 534; cf. Binnington
v. Wallis
Wallis (1821)
(1821) 4 B. &
IllS. Co. (1876)
Billnillgton 'lJ.
&
Ald. 65o.
650.
On the other hand, where the defendant
defendant had made a written promise
to remain with the plaintiff for two years for the purpose of learning
learning to
be a dressmaker,
dressmaker, the court refused to draw the inference of a promise
promise
by the defendant
defendant to serve or of a promise by the plaintiff to employ.
Lees
v. Whitcomb (1828)
(1828) 5 Bing. 34.
34, 2 M. & P. 86.
Lecs'lJ.
13 Beach v. Mullin
(1870) 34 N. J. L. 343, 345; Grossman
Grossman v.
13
Mullil~ (1870)
'lJ. Schenker
SchenllCr
(1912) 2o6
Mechem, Agency
ed.) sec. 603.
6o3.
(1912)
206 N. Y. 466. See Mechem,
Agcllc'j) (2d ed.)
24American Pub.
v. Walker (igol)
14A1Ilcricall
Pub. Co. 'lJ.
(1901) 87 Mo. App.
App. 503; Gordon
Gordon Malting
Bartels Brewing Co. (1912)
(1912) 206
26 N. Y. 541; Sal~ford
Sanford 'lJ.
v. Brown
'lJ. Bartels
Bro~tm
illg Co. v.
Bros.
(1913) 208
2o8 N:
NM.
go; Bauman
v. McManus
McManus (1907)
(19o7) 75 Kan. 106.
io6.
Bros. Co. (1913)
Y. 90;
Bauman'lJ.
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OFFERAND
ANDACCEPTANCE
ACCEPTANCE
O'FFER
179
express their
their intention
intention but
but not
not consisting
consisting ofof words,
words, either
either
toto express
spoken
or
written.
It
can
easily
be
seen
that
a
tacit
contract
isis
contract
tacit
a
that
seen
be
easily
can
It
spoken or written.
also,
in
a
broader
sense,
an
express
one.
Words
are
often
lame
lame
often
are
Words
one.
express
an
also, in a broader sense,
and halting
halting things
things inin performing
performing their
their function
function ofof expressing
expressing
and
thought.
It
is
often
true
in
fact
that
actions
speak
louder
than
than
louder
speak
actions
that
fact
in
thought. It is often true
words.
The
term
implied
contract
is
generally
used
to
mean
mean
to
used
generally
is
contract
words. The term implied
exactly the
the same
sameasas tacit
tacit contract.
contract. The
The intention
intention of
of the
the parties
parties
exactly
Qr
inferred
from
their
actions
other
than
words.
is
"implied"
words.
than
other
actions
their
is "implied" or inferred from
For
some
centuries,
however,
it
has
been
customary
to
describe
describe
to
customary
been
has
For some centuries, however, it
as aa "contract
"con~ract implied
implied in
in law"
law" certain
certain other
other legal
legal relations,
relations, inin
as
cases
where
neither
the
words
of
the
parties
nor
their
other acts
acts
other
their
nor
parties
cases where neither the words of the
justify
an
inference
that
they
intended
to
create
such
relations.
relations.
such
create
to
justify an inference that they intended
This usage
usage seems
seems toto have
havebeen
been due
due to
to two
two reasons:
reasons: inin the
the earlier
earlier
This
cases
the
courts
desired
to
make
the
form
of
action
called
called
action
of
cases the courts desired to make the form
not
assttmpS'i..t
available
for
the
enforcement
of
certain
duties
not
duties
certain
assumpsit available for the enforcement of
intentionally
assumed;
and
in
some
of
the
later
cases
the
courts
courts
the
cases
intentionally assumed; and in some of the later
desired to
to avoid
avoid the
the appearance
appearance of
of creating
creating legal
legal rights
rights and
and
desired
duties
where
the
parties
had
not
so
agreed.
Thus
the
term
implied
implied
term
duties where the parties had not so agreed. Thus the
contract became
became aa slippery
slippery one
one upon
upon which
which judicial
judicial reasoning
reasoning has
has
contract
not
infrequently
slipped
into
error.
The
legal
relations
commonly
not infrequently slipped into error. The legal relations commonly
described as
as contracts
contracts implied
implied in
in law
law are
are now
now coming
coming to
to be
be called
called
described
quasi
contracts.
It is
is not
not necessary
necessary here
here to
to describe
describe what
what these
these
quasi contracts. It
are; it
it is
is enough
enough to
to observe
observe that
that they
they are
are not
not contracts
contracts in
in fact,
are;
either express
express or
or tacit.
tacit.
either
VOID, VOIDABLE,
VOIDABLE, AND
AND UNENFORCIBLE
UNENFORCIBLE CONTRACTS
CONTRACTS
VOID,
The term
contract is
apparent self-contradiction.
self-contradiction. This
an apparent
is an
void contract
term void
The
depends,
however,
upon
the
sense
which
we are using the term
in
sense
depends, however, upon the
contract.
In
this
case
it
appears
of
to refer to the acts of
used
be
to
contract. In this case it appears
offer
and
acceptance
by
the
parties
to
the
document
evidencing
evidencing
or
offer and acceptance by the parties
such
acts.
such acts.
In
contract, the parties perform acts that
void contract,
of aa void
case of
the case
In the
would
usually
operate
to
would usually operate to create new contractual relations, but
other
have
the particular case. Rights and other
in the
operation in
such operation
no such
fiave no
relations
will
exist
after
such
a
transaction,
but
they
will
not
be
they
relations will exist after such a
contract
rights
and
relations.
A
contract
right
is
a
primary
a
is
contract rights and relations. A contract right
the
right
In the
consent. In
of consent.
expressions of
from expressions
arising from
personam arising
in personam
right in
but
case
of
a
void
contract,
there
are
expressions
of
agreement,
but
case of a void contract, there are expressions of agreement,
they
mere
are mere
acts are
these acts
If these
effect. If
legal effect.
usual legal
the usual
have the
not have
do not
they do
they
words,
they
are
not
operative
facts
at
all.
Standing
alone,
they
alone,
Standing
all.
at
facts
operative
not
are
they
words,
by
have
accompanied by
be accompanied
however, be
may, however,
They may,
effect. They
legal effect.
no legal
have no
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YALE
other acts,
acts, e.e. g.,
g., aa delivery
delivery of
of goods,
goods, that
that have
have legal
legal operation.
operation.
other
The
legal
relations
consequent
upon
these
accompanying
acts
The legal relations consequent upon these accompanying acts
are
never
the
ones
that
the
parties
had
in
contemplation.
The
are never the ones that the parties had in contemplation. The
offer
creates
no
legal
power
in
the
offeree;
and
if
his
act
of
offer creates no legal power in the offeree; and if his act of
acceptance creates
creates new
new legal
legal relations,
relations, that
that isis due
due to
to legal
legal powers
powers
acceptance
that he
he possessed
possessed even
even before
before the
the offer
offer was
was made.
made.
that
In
the
case
of
a
voidable
contract,
the acts
acts of
of the
the parties,
parties, even
even
In the case of a voidable contract, the
when they
they are
are mere
mere words,
words, operate
operate to
to create
create new
new legal
legal relations,
relations,
when
and these
these are
are in
in aa measure
measure the
the ones
ones contemplated
contemplated by
by the
the parties.
parties.
and
They
are
usually
described
as
rights
and duties,
duties, privileges
privileges and
and
They are usually described as rights and
powers, etc.,
etc., just
just as in
in the
the case of
of aa valid
valid contract
contract ;15
;15 but
but one
one of
of
powers,
the parties
parties has the
the additional
additional power
power and
and privilege
privilege of
of extinguishextinguishthe
ing them.
them. The
The exercise
exercise of
of this power
power is
is described
described as
as the
the disafdisafing
firmance
or
avoidance
of the
the contract.
contract. Another way of
of describdescribfirmance or avoidance of
ing aa voidable
voidable contract
contract is
is to
to say
say that
that the
the contemplated
contemplated contractual
contractual
ing
relations
do
not
yet
exist,
but that
that one of
of the
the parties
parties has an
relations do not yet exist, but
irrevocable power
power to
to create
create them.
them. His
His subsequent
subsequent act is then
irrevocable
called
ratification.
called ratification.
The term
term unenforcible
unenforcible contract
contract includes both
both void contracts
contracts
The
and voidable
voidable contracts.
contracts. It
It is
is customarily
customarily used
used so as to describe
and
certain other
other legal
legal relations
relations also.
also. When a contract has become
certain
unenforcible by
by virtue
virtue of the statute of limitations, the obligor or
or
unenforcible
debtor has
has aa power
power to
to create
create aa new right in the other party
debtor
as against
against himself
himself (and
(and to
as
to destroy his own existing privilege) by
mere expression
expression of
of his
his will,
will, without any act of assent by the
aa mere
other and
and without
without aa new
consideration. He cannot, however, as
other
new consideration.
in
voidable contract,
the existing rights of the other
other
in aa voidable
contract, destroy
destroy the
party
rights in himself as against that other.
party or
or create
create new
new rights
When aa contract
contract is unenforcible
unenforcible by reason of the statute of
When
of
frauds, either
either party
party has
frauds,
has the
the legal
legal power to create rights as
against himself
himself (or
(or to
destroying
against
to terminate
terminate his existing
existing power of destroying
the
rights) by
by signing
signing aa written
written memorandum,
the other's
other's rights)
memorandum, but
he
no such
he has
has no
such power
power to
to create
create rights in his own favor.
In
relation exists
In these
these cases
cases aa legal
legal relation
exists that is different
different from
that
that existing
existing in
in the
the case
case of
of aa void
void contract
contract or of a voidable one.
15 "It was resolved
that in all cases when the deed is voidable, and so
15 "It was resolved that in all cases when the deed is voidable, and so
remains
at the
the time
time of
of the
the pleading
pleading (as
(as if an infant
infant seals
seals and
and delivers
delivers aa
remains at
deed,
or aa man
man of
of full
full age
age by
by duress)
duress) in
in these
these and
and the
the like cases,
cases, the
deed, or
obligor
obligor cannot
cannot plead
plead non
n01~ est
est factum,
factum, for itit is his
his deed
deed at the time of the
action
Whelpdale's Case
Case (I6o5)
(1605) 55 Coke,
Coke, ihg
119 a; Wald's
Wald's Polaction brought."
brought." Whelpdale's
lock,
Contracts (3d
(3d ed.)
ed.) p.
p. 7;
7; Windscheid,
Windscheid, Pandekten,
Pandekten, I,I, secs.
sees. 7o,
70, 82.
82.
lock, Contracts
HeinOnline -- 26 Yale L.J. 180 1916-1917
OPFER AND
AND ACCEPTANCE
ACCEPTANCE
OFFER
181
appears that
that this
this difference
difference isis not
not asas one
one author
author says,
says, "mainly
"mainly
ItIt appears
1
differencebetween
betweensubstance
substanceand
andprocedure."'
procedure."16
The difference
difference
The
aa difference
between aa power
power toto create
create aa right
right against
against another
another person
person and
and aa
between
merely
not
power
to
create
a
right
against
only
oneself
is
not
merely
is
oneself
only
against
right
a
create
to
power
procedural.
procedural.
Both voidable
voidable and
and unenforcible
unenforcible contracts
contracts are
are like
like valid
valid conconBoth
and
tracts
in
this:
there
have
been
acts
expressing
agreement,
and
agreement,
tracts in this: there have been acts expressing
they
are
legally
operative
facts
creating
new
legal
relations.
The
The
relations.
they are legally operative facts creating new legal
resulting legal
legal relations
relations are
are different
different from
from those
those existing
existing in
in the
the
resulting
case
of
a
valid
contract;
but
these
relations
are
distinct
inin
distinct
case of a valid contract; but these relations are
character,
are
of
considerable
practical
importance,
and
deserve
deserve
character, are of considerable practical importance, and
even better
better names
names than
than they
they have
have received.
received.
even
There
are
next
to
be
considered
the acts
acts of
of offer
offer and
and acceptacceptThere are next to be considered the
ance by
by means
means of
of which
which the
the foregoing
foregoing legal
legal relations
relations are
are finally
finally
ance
established, and
and also
also some
some of
of the
the intermediate
intermediate relations
relations that
that arise
arise
established,
prior to
to the
the closing
closing of
of the
the contract.
contract.
prior
THE OFFER
OFFER
THE
Definition. An
An offer
offer is
is defined
defined above
above as
as an
an act
act whereby
whereby one
one
Definition.
person
confers
upon
another
the
power
to
create
contractual
contractual
create
to
power
the
another
person confers upon
relations between
between them. It
It has not
not been
been customary
customary to
to describe
describe
relations
offer;"
as
a
"power"
the
new
legal
relation
consequent
upon
an
offer ;17
an
upon
consequent
relation
as a "power" the new legal
but
this
term
seems
to
be
the
most
accurate
description
of that
that
of
description
accurate
most
but this term seems to be the
of
relation.
It
is
similar
to
the
relation
in
the
case
of
case
the
in
existing
relation
relation. It is similar to
agency.1S
The
principal,
by
an
act
called
"appointment,"
"appointment,"
called
agency."" The principal, by
creates in
in the
the agent
agent the power
power of creating
creating (in
conjunction with
(in conjunction
creates
aa third
person)
new
legal
relations
between
the
principal and
principal
between
third person) new
aa third
third person.
After
the
one
voluntary
act
of
the principal
voluntary
person.
called
"appointment,"
nothing
further
remains
to
be done
done by
called "appointment,"
him; thereafter
thereafter it is the voluntary act of the agent that is operahim;
tive
offer: the act
relations. So in the case of an offer:
new relations.
create new
to create
tive to
of
the offeror
offeror operates
create in the offeree a power, and
operates to create
of the
having
is exhausted; thereafter the voluntary act of
operated it is
so operated
having so
i9.
ill
Contracts (2d Am. ed., Huffcut) sec. 19.
18 Anson, COI~tracts
seen
that has been seen
of this concept that
presentation of
best, presentation
17
first, and the best,
17 The first,
by
Conceptions
Legal Conceptions
Some Fundamental Legal
on Some
article on
the article
in the
is in
writer is
the writer
by the
49, by
i6, 49,
as
JouRNAL, 16,
LAW JOURNAL,
YALE LAW
in 23 YALE
Reasoning, in
Judicial Reasoning,
in Judicial
Applied in
as Applied
ingreat inProfessor
acknowledges great
writer acknowledges
N. Hohfeld, to whom the writer
W. N.
Professor W.
speaks
debtedness.
court speaks
the court
I68, the
Mass. 168,
122 Mass.
(1877) 122
Dobbins (1877)
Jordanv. Dobbi,~s
In Jordan
debtedness. In
of
any
at any
he might at
which he
authority which
or authority
power or
as "a power
guaranty as
continuing guaranty
of aa continuing
time
revoke."
time revoke."
p. 46.
46.
cit. p.
loc. cit.
Hohfeld, loco
1S
See Hohfeld,
18 See
14
HeinOnline -- 26 Yale L.J. 181 1916-1917
YALE LAW
LAW JOURNAL
YALE
the offeree alone will operate
create the new relations called
operate to create
called
a contract.
Operative Act. \Vhat
What kind of act creates
of
The Operative
creates a power of
acceptance and is therefore
of
acceptance
therefore an offer? It must be an expression of
It must be an act that leads the offeree reasonawill or intention. It
bly to believe that a power to create a contract is conferred upon
upon
him. This applies to the content
content of the power
power as well as to the
It is on this ground
fact of its existence. It
ground that we must exclude
exclude
invitations to deal or acts of mere
mere preliminary
preliminary negotiation, and
acts evidently done in jest or without
without intent to create
create legal relarelations. All these are acts that do not lead others reasonably to
believe that they are empowered "to close the contract."
contract." So
long as it is reasonably
reasonably apparent
apparent that some further act of the
offeror is necessary, the offeree
offeror
offeree has no power to create
contractual
contractual relations by an act of his own and there is as yet no
offer.
Communication. No act can induce
Communication.
induce another
another to believe that he
empowered to accept unless he is aware that the act has been
been
is empowered
performed. So it would seem to be essential that an offer
offer shall
communicated to the offeree, and it has generally been held
be communicated
that acceptance
acceptance is impossible prior to such communication. Thus,
where a reward was offered by publication,
publication, for service desired,
it has been held that the rendition of the service in ignorance
of the offer creates no contract. 199 The contrary has been
been held
20
in some cases.20 Some
Some judges have thought that where
where two
offers, identical
identical in terms, cross each other in the mail, there is no
2
contract.
' In these two instances there is DO
no contract
contract.:!l
contract if the
only way to create
create a contract
contract is by the machineiy
machine.y of offer and
acceptance, regarded
regarded as acts expressing consent. In the reward
cases, the offeror
offeror has acted
acted and has consented;
consented; the offeree
offeree has
case
acted but his act was not an expression
expression of consent. In the case
of crossed offers, each party has acted and has expressed consent;
consent;
19
Fitch v. SlIedaker
Snedaker (1868)
(1868) 38 N. Y. 248; Vitty v. Eley (1900)
(igoo) 51
5I App.
19 Fitch
Div. (N.
(N.
44;
Williams
v.
Chi.
St.
(igoi)
I9I Ill. 610.
6io.
Y.)
Williams
West.
Chi.
Ry.
(1901)
191
20 Gibbons v. Proctor (1891) 64 L. T. (N. S.) 594; disapproved by
20 Gibbons v. Proctor (1891) 64 L. T. (N. S.) 594; disapproved by
Pollock, COlltracts
Contracts (3d ed.)
ed.) p. 21; also by Anson, Contracts
Contracts (2d. Am.
ed., Huffcut)
Huffcut) p. 25; also by Ashley, Contracts,
Contracts, p. IS.
iS. Smith v. State
State
(1915)
x5i Pac. (Nev.)
Dawkins v. Sappillgton
Sappington (1866)
199;
(1915) 151
(Nev.) 512; Dawkins
(1866) 26 Ind. 199;
Stone v.
v. Dysert
(1878) 20
Gann (1866)
(1866) 52 Pa.
Stolle
D)'sert (1878)
20 Kan. 123; Cummings v. Ga1l1~
S.) 740.
St. 484; Neville v. Kelly (1862)
(1862) 12 C. B. (N.
(N. S.)
740.
2t Tinll
Tinn Z'.
v. Hoffman
29 L.
L. T.
T. (N.
S.) 271;
27i; two
two judges
21
Hoffman (1873)
(1873) 29
(N. S.)
judges contra.
contra.
HeinOnline -- 26 Yale L.J. 182 1916-1917
OFFER AND
AND ACCEPTANCE
ACCEPTANCE
OFFER
but inin soso doing,
doing, neither
neither has
has knowingly
knowingly exercised
exercised aa power
power conconbut
ferred by
by the
the other
other and
and neither
neither has
has been
been induced
induced toto believe
believe
ferred
that he
he has
has such
such aa power
power toto exercise.
exercise. Each
Each has
has done
done an
an act
act
that
conferring aa power
power upon
upon the
the other,
other, and
and either
either one
one may
may now
now
conferring
exercise that
that power
power by
by aa subsequent
subsequent act
act and
and thus
thus create
create aa conconexercise
tract. There
There is,
is, however,
however, no
no inevitable
inevitable necessity
necessity inin our
our adopadoptract.
tion of
of the
the machinery
machinery of
of offer
offer and
and acceptance.
acceptance. The
The rules
rules of
of
tion
contract, like
like all
all other
other rules
rules of
of law,
law, are
are based
based upon
upon mere
mere
contract,
matters of
of policy,
policy, or
or belief
belief as
as to
to policy.
policy. In
In the
the process
process of
of our
our
matters
evolutionwe
we find
find that
thatsome
some or
or all
all of
of us
us are
are following
following aa customary
customary
evolution
rule. When
When we
we become
become conscious
conscious of
of this
this fact,
fact, we
we try
try to
to express
express
rule.
the rule
rule in
in words
words and
and to
to compel
compel others
others to
to obey
obey itit by
by legislative
legislative
the
command. We
We may
may fail
fail in
in our
our attempt,
attempt, either
either because
because the
the
command.
custom
supposed
is
not
the
custom
of
the
powerful,
or
because
because
or
powerful,
the
of
custom
the
not
is
supposed
custom
we have
have failed
failed to
to express
express itit with
with accuracy,
accuracy, or
or because
because new
new life
life
we
conditions
require
new
customs.
So,
therefore,
we
may
decree
decree
may
we
therefore,
So,
customs.
new
require
conditions
that two
two acts
acts expressing
expressing consent,
consent, as
as in
in the
the case
case of
of crossed
crossed offers,
offers,
that
has
shall
create
contractual
relations;
or
that
where
an
offer
has
offer
an
where
that
or
relations;
contractual
shall create
been
published,
that
act
empowers
others
to
create
contractual
contractual
create
to
others
empowers
act
that
been published,
relations by
by doing
doing the
the acts
acts requested,
requested, even
even though
though without
without
relations
knowledge
of
the
request.
It
seems
not
improbable
to the
the
to
improbable
not
seems
It
request.
knowledge of the
22
22
the
writer
that
this
latter
rule
prevail
in
the
future.
In
In
future.
the
in
prevail
will
rule
writer that this latter
vast majority
majority of
of cases,
cases, however, contracts
contracts will
will be
be made
made by offer
offer
vast
and
acceptance
as
analyzed
above.
above.
and acceptance as analyzed
Time Limit.
Limit. An offer
offer having
having been
been made
made and
and a power having
having
Time
been
thereby
created,
how
long
will
this
power
continue
to
exist?
exist?
been thereby created,
The
offeror is
is the
the creator of the power, and before
before it leaves his
The offeror
will. Such is the present
present decree
hands
he may
may fashion it to his will.
hands he
of
society.
If
he
specific
period
existence, the
existence,
its
for
a
names
of society. If he
names
If
the
offeror
offeree
can
accept
only
during
tliis
period.
If
this
offeree can
no
period
whatever,
the
power
will
be
held
to
exist
for
a
reasonano period whatever, the
ble
dependent
determined as a fact by the court and dependent
be determined
to be
time, to
ble time,
223
3
upon
the
circumstances.
If
the
parties
are
negotiating
in each
each
If
upon the circumstances.
short
other's
presence,
the
reasonable
time
will
usually
be
a
very
short
other's presence, the reasonable
one;
of acceptance
that the power of
indicates that
offeror indicates
the offeror
if the
but if
one; but
will be
is
to
be
exercised
in
absentia,
the
reasonable
time will
is to be exercised in absentia,
657.
sec. 657.
Code, sec.
Civil Code,
by the German Civil
adopted by
22
in fact adopted
rule in
This is the rule
22 This
Ashley,
Contracts,
p.
13,
says:
"An
offer
uncommunicated
is
inconceivable."
inconceivable."
is
uncommunicated
Ashley, Contracts,p. 13, says: "An
For
supra.
2o, supra.
note 20,
see note
conceived, see
fact conceived,
in fact
was in
where itit was
cases where
For cases
23
v. Hedge
Hedge (r838)
(1838)
409; Averill
Averill v.
(Mass.) 409;
v. Boston
Boston (r844)
(844) 77 Met. (Mass.)
23 Lorillg
Loringv.
12
.
424.
Conn. 42412 Conn.
HeinOnline -- 26 Yale L.J. 183 1916-1917
YALE LAW
LAW JOURNAL
JOURNAL
YALE
considerably longer.
longer.2i24 If
If the
the time
time taken
taken by
by the
the offeree
offeree would
would
considerably
appear
to
be
reasonable to
to aa reasonably
reasonably prudent
prudent man
man inin his
his
appear to be reasonable
position, the
the acceptance
acceptance isis operative
operative even
even though
though the
the offeror
offeror did
did
position,
not intend
intend the
the power
power to
to exist
exist for
forso
so long
longaaperiod.
period. AA reasonable
reasonable
not
time
may be
be longer
longer than
than the
the offeror
offeror in
in fact
fact intended.
intended. On
On the
the
time may
other hand,
hand, there
there seems
seems to
to be
be no
no good
good reason
reason for
for holding
holding that
that
other
the power
power of
of acceptance
acceptance has
has expired
expired ifif itit can
can be
be shown
shown as
as aa
the
fact
that the
the offeror
offeror intended
intended that
that itit should
should still
still exist.
exist. AA
fact that
reasonable time
time may
may be
be longer
longer than
than the
the offeror
offeror intended,
intended, but
but itit
reasonable
5
less.252
be less.
never be
can never
can
Revocation. In
In most
most cases
cases the
the offeror
offeror may
may terminate
terminate the
the
Revocation.
power of
of acceptance
acceptance prior
prior to
to the
the end
end of
of the
the specified
specified period,
period, ifif
power
any, or
or of
of ~he
the reasonable
reasonable time.
time. In
In the
the first
first place
place he
he may
may have
have
any,
expressly
provided that
that the
the power
power should
should be
be subject
subject to
to revocarevocaexpressly provided
tion, either
either by
by notice
notice to
to the
the offeree
offeree or
or without
without such
such notice.
notice. If
If he
he
tion,
provides
for aa revocation
revocation without
without notice
notice and
and by
bT aa mere
mere change
change
provides for
of his
his mental
mental state,
state, he
he can
can scarcely
scarcely be
be said
said to
to have
have conferred
conferred
of
any
power at
at all.
all. The
The power
power conferred
conferred by
by such
such an
an offer
offer is
is aa very
very
any power
flimsy one
one indeed,
indeed, for
for the
the validity
validity of
of the
the acceptance
acceptance will
will depend
depend
flimsy
upon the
the offeror's
offeror's own
own will
will when
when he
he is
is notified
notified of
of the acceptance.
acceptance.
upon
Such
an
offer
is little
little more,
more, in
in effect,
effect, than
than an invitation
invitation for bids.
bids.
Such an offer is
If the
the reserved
reserved power
power of
of revocation
revocation is
is to
to be
be exercised
exercised by an overt
overt
If
act, then
then there
there is
is aa substantial
substantial power
power of
of acceptance,
acceptance, the validity
act,
of
the
act
of
acceptance
being then
then not
not dependent
dependent upon
upon the
the will of
of
of the act of acceptance being
the offeror.
offeror.
the
Even though the power to revoke has not been expressly
Even
though the power to revoke has not been expressly
reserved by the offeror, it can be said that as a general rule he
reserved by the offeror, it can be said that as a general rule he
retains such a power. In such a case, however, the power to
retains such
a power. In such a case, however, the power to
revoke can be exercised only in a particular manner. If the
revoke can be exercised only in a particular manner. If the
offer was made by publication, it has been held that it can
offer was made by publication, it has been held that it can
be revoked
revoked either
either by
by actual
actual notice
notice to
claimant or
or by
by aa notice
be
to aa claimant
notice
0
published
as was
the offer.
offer.226
If
published in
in the
the same
same manner
manner as
was the
If the offer
offer
24 The German Civil Code, sec. 147, lays down substantially the same rule.
24 The German Civil Code, sec. 147, lays down substantially the same rule.
25 All that would seem to be necessary is overt action by the offeror
25 All that would seem to be necessary is overt action by the offeror
sufficiently
that the
the power
power shall
shall continue.
continue. This
This
sufficiently indicating,
indicating, his
his intention
intention that
principle
A1actier v.
principle is
is involved
involved in
in the
the facts
facts of
of Mactier
'iI. Frith
Frith (183o)
(1830) 66 Wend.
\Vend.
(N.
v. Hoffman (1873)
(N. Y.)
Y.) lo3;
103; Tinn
Tim~ 'iI. Hoffman
(1873) 29
29 L.
L. T.
T. (N.
(N. S.)
S.) 271.
271. See
See criticisms
criticisms
of
Frith, in Langdell, Summary
of Mactier
.Mactier v.
'iI. Frith, in Langdell,
Summary of
of Cont.,
COli f., sec.
sec. 14,
14, and
and Ashley,
Ashley,
Contracts,
p.p. 48.
Contracts,
48.
2
0SZuey
v. U. S. (1875) 92 U. S.73; Pollock says of this case: "it
26 Shuey 'iI. U. S. (1875) 92 U. S. 73; Pollock says of this case: "it
seems
a
rather
seems a rather strong
strong piece
piece of
of judicial
judicial legislation."
legislation." Wald's
Wald's Pollock,
Pollock,
Contracts
Contracts (3d
(3d ed.)
ed.) p.
p. 23.
23. To
To the
the writer
writer itit seems
seems no
no stronger
stronger than
than are
are
HeinOnline -- 26 Yale L.J. 184 1916-1917
OFFER AND
AND ACCEPTANCE
ACCEPTANCE
OPFER
was made
made by
by personal
personal communication
communication to
to one
one or
or more
more particular
particular
was
persons,
it
can
be
revoked
only
by
giving
notice
to
them,
such
persons, it can be revoked only by giving notice to them, such
727
notice
being
effective
only
when
received.
notice being effective only when received."
Irrevocable Offers.
Offers. It
It has
has been
been asserted
asserted that
that no
no offer
offer can
can be
be
Irrevocable
28 various reasons being
such aa conconirrevocable,28
advanced for such
various reasons being advanced
irrevocable,
clusion. ItIt may
may be
be that
that by
by the
the prevailing
prevailing rule
rule of
of the
the common
common
clusion.
law offers
offers are
are always
always revocable;
revocable; it may
may even
even be
be true that
that
law
considerations of
of policy
policy and
and convenience
convenience require
require that
that all
all offers
offers
considerations
shall be revocable;
revocable; but
but itit is here
here insisted
insisted that
that the
the question
question of their
their
shall
revocability is not
not to be
be determined
determined by rules
rules of
of pure
pure logic
logic or
or of
of
revocability
mathematics, that
that there
there is no inevitable
inevitable necessity
necessity or
or universal
universal
mathematics,
law foreclosing
foreclosing discussion.
discussion. The
The principle
principle here to
to be
be adopted
adopted
law
the decisions
decisions on any other rule
rule of the
the law.
law. See
See also
also Sears
Sears'll.
Eastem R.
R.
v. Eastern
the
(1867) 14
14 Allen
Allen (Mass.)
(Mass.) 433.
433. The
The same
same rule
rule is adopted
adopted by
by the GerGerCo. (1867)
man Civil
Civil Code, sec.
sec. 658,
658, and
and by
by the
the Jap. Civil
Civil Code,
Code, art. 530.
530.
man
27
27 Byrne
B~'rIIe v. Van Tienhoven
Tie1lho'llen (i88o)
(1880) 5 C. P. D. 344;
344; Stevenson
Stevensol~ v. McLean
(1880) 5 Q. B. D. 346. See
See also Dickinson
Dickinson v. Dodds
Dodds (1876)
(1876) 2 Ch.
Ch. D. 463;
463;
(188o)
Frank v. Stratford
Stratford (1904)
Wyo. 37.
(19o4) 13 Wyo.
Frank
In the early
early case of Hurford
Hurford v. Pile
Pile (1615)
(1615) Cro. Jac. 483, an offer
offer
In
seems to have
have been
been held
held to
to be
be irrevocable. The
The entire
entire report
report is
is as follows:
follows:
seems
execution for forty
forty pounds, the
Whereas J. S. being in execution
Assumpsit. Whereas
defendant said,
said, "Deliver
"Deliver J. S. out
out of execution,
execution, and
and what
what it cost
cost you
you I
defendant
repay;" wherefore
wherefore J. S. was
was discharged
discharged by the plaintiff. The
The defenddefendwill repay;"
plea saith, that after the assumpsit,
assmnpsit, and before the plaintiff had
ant for plea
done any thing in that
that business, he forbade him to meddle
meddle therein, and
done
stand to his promise. The plaintiff demurred;
demurred; and itit
that he would not stand
was adjudged for the plaintiff.
assumpsit made
that a man may discharge
discharge an assumpsit
Houghton, Justice, said, that
cannot discharge
discharge an assumpsit
assumpsit made by himself: but,
to himself, but he cannot
defendant's counsel
counsel moved, that it was a good plea,
at another day, the defendant's
and that as long as nothing was done, it was but an executory
executory promise.
Doderidge. If
promise to J.
J. S. that if he build an house upon my
If I promise
Doderidge.
counterland before Michaelmas, I will pay him a hundred pounds, and I counterthing'concerning
.concerning the house, it is a good
mand it before he hath done any thing
countermand.
.
countermand.
Houghton e contra;
damages
contra; but he said, that may be considered in damages
Houghton
adjourtlatur.
adjournatur.
Afterwards,
Afterwards, in Trinity term, judgment was given for the plaintiff.
Lev. 244.
See also Howe
(1685) 3 Lev.
Beeche (1685)
Howe v. Bceche
28 "It
"It is indispensable to the making of a contract that the wills of the
28
of
contracting
moment of
do, in legal contemplation, concur at the moment
contracting parties do,
making
therefore, which the party making it has no power
power
offer, therefore,
making it. An offer,
to revoke,
of
Summary of the Law of
impossibility." Langdell. Summary
revoke, is aa legal impossibility."
COtltracts,
4. See
See also, Wormser, The True Conception
178, also sec. 4.
Contracts,sec. 178,
of
Lee, Contract,
JoURNAL, 137, note; Lee,
26 YALE LAW JOURNAL,
of Unilateral
Unilateral Contracts, 26
sec. 13.
Contracts,sec.
Jenks,
i9"; Ashley, Contracts,
sec. 195;
Eng. Civ.
Civ. Law, sec.
of Eng.
Jenks, Digest
Digest of
HeinOnline -- 26 Yale L.J. 185 1916-1917
186
YALE
LAW JOURNAL
YALE LAW
character as any other legal principle, and is to be
is of the same
same character
be
established custom, by positive legislation,
determined by established
legislation, and by
convenience.2299 In various systems
systems
considerations
considerations of policy and convenience.
of law in other
other countries, and sometimes by statute
statute in this
declared to be irrevocable
irrevocable under
under
country, offers are expressly
expressly declared
certain circumstances.
circumstances. so0 These
These statutes,
statutes, however, might be
be
privilege of revoking
revoking
construed as depriving the offeror of his privilege
It is not believed
believed
without
p01.uer to revoke. It
without depriving him of his power
that they would be so construed'.
construed. The view that an offer cannot
cannot
be irrevocable
irrevocable seems based upon a failure to bear in mind the
conferred upon the
relation as a power conferred
essential character
character of the relation
If an offer were a physical emanation,
emanation, a sort of radioofferee. If
activity
human body, no doubt a stop might always be put
activity of a human
to it. If
If an offer were
were a state of mind, no doubt society could
could
not ordain its continuance
continuance against the offeror's will.8s11 An offer,
power to
to
however, is an act creating the legal relation called aa power
accept. The act cannot be revoked at all, for it is of yesterday.
The resulting power is from society
society and can be maintained by
82
indefinitely.
society indefinitely.s2
as "irrelevant."
"irrelevant!'
29
Langdell seemed
to regard
regard considerations
considerations of
of this
this sort
29 Langdell
seemed to
sort as
See Summary
15.
Sf,mmary of the Law of Contracts,
Contracts, sec. 15.
80 Swiss
of Obligations,
sec. 3:
3: "One
who makes
makes an
an offer
to
so
Swiss Code
Code of
Obligations, sec.
"One who
offer to
acceptance, is bound by his
another, and prescribes
prescribes a definite time for acceptance,
offer until the expiration of the time fixed."
German
German Civil Code, sec.
sec. 145: "One
"One who has conferred
conferred upon another
another
provided
the power to close a contract is bound by his offer unless he has provided
to the contrary."
contrary." (But
(But the Code provides that if no time is specified, the
acceptance must take place within a brief period
acceptance
period according to circumcircum147-150.)
"An offer
offer of a reward is revocable
revocable
stances. See secs.
secs. 147-150.)
Sec. 658: "An
prior
prior to the beginning of performance."
performance."
made with a
Japanese Civil Code, art. 521: "An offer of a contract mad~
withdrawn." Art.
specified for acceptance
acceptance cannot be withdrawn."
fixed period of time specified
of
524: "An offer made to a person at a distance without fixing a period of
of
time for acceptance
acceptance thereof, cannot be withdrawn
withdrawn for such a period of
time as is reasonably necessary for the offeror
offeror to receive
receive notice
notice of the
acceptance."
acceptance."
By sec. 3645, Civil Code of Georgia, it is provided that a "party may
withdraw
proposition, unless a given time is agreed on in
withdraw his bid or proposition,
which the other party
v. Maddo~
Maddox (1898)
party may assent." See Black v.
(18gB) 1o4
104
Ga. 157, 161.
I6I.
81
expressions
SI This was perhaps
perhaps Langdell's view, although he often uses expressions
inconsistent
maintained in Ashley, Contracts,
Contracts, sec. 13.
inconsistent with it; and it is maintained
82
Lindsell (1818)
(i818) I1 B. & Ald.
Aid. 681, it was said:
S2 In
In Adams
Adams v.
v. Lilldsell
said: "The
as making, during every instant of
of
defendants
considered in law as'
defendants must be considered
the time their letter was travelling, the same identical offer to the plain-
HeinOnline -- 26 Yale L.J. 186 1916-1917
OPFER AND
AND ACCEPTANCE
ACCEPTANCE
OFFER
PhysicalLimitation.
Limitation. Irrevocability
Irrevocability may
mayhave
have any
anyone
of several
several
one of
Physical
to revoke
revoke by
by
meanings: first,
first, that
that the
the offeror
offeror has
has no
no legal
legal power
power to
meanings:
or unlawful;
unlawful; second,
second, that
that he
he isis not
not legally
legally
any means,
means, lawful
lawful or
any
to revoke,
revoke, although
although he
he may
may have
have the
the legal
legal power;
power; third,
third,
privileged to
privileged
of
that although
although he
he has
has both
both the
the legal
legal power
power and
and the
the privilege
privilege of
that
revoking by
by certain
certain means,
means, these
these means
means are
are not
not within
within his
his present
present
revoking
Under our
our law
law nearly
nearly all
all offers
offers are
are for
for aa time
time
physical capacity.
capacity. Under
physical
irrevocable in
in the
the third
third sense.
sense. Revocation
Revocation can
can take
take place
place only
only
irrevocable
after aa certain
certain fashion,
fashion, commonly
commonly by
by giving
giving actual
actual notice
notice to
to
after
as itit is
is impossible
impossible to
to reach
reach the
the offeree
offeree
the offeree.
offeree. So
So long
long as
the
or to
to do
do such
such other
other act
act as
as may
may amount
amount to
to aa
with such
such aa notice
notice or
with
of acceptance
acceptance will
will continue
continue to
to exist.
exist.8333
revocation, the
the power
power of
revocation,
This means
means that
that although
although the
the offeror
offeror is
is privileged
privileged to
to revoke
revoke and
and
This
has the legal
legal power
power to revoke
revoke by
by doing
doing certain
certain acts,
acts, the performperformthese acts
acts is
is beyond
beyond his limited
limited human
human capacity.
capacity.
ance of these
ance
Contractual
Limitation.
An
offeree's
power
is irrevocable
irrevocable in
in
is
power
offeree's
An
Limitation.
Contractual
notice or
or otherwise,
othenvise, if the
the second
second sense,
sense, either
either by
by the giving
giving of notice
put in the form
form of a conditional
conditional covenant
covenant or simple
simple
offer is put
offer
4 or if the offer
contract,3'
offer
is
accompanied
promise
not
to
not
a
promise
by
accompanied
contract, or if the
tiffs." See
See also
also Boston
Boston and Maine
Maille R. Co. v. Bartlett (1849)
(1849) 3 Cush.
tiffs."
(Mass.) 224; Nyulasy v. Rowan
Rowall (i8gi)
(IBgI) 17
17 Vict.
Viet. L. P.
R 663.
663. If
If an offer
offer
(Mass.)
were at every instant revocable,
revocable, these decisions would be
be wrong, and
and
were
Cooke v. Oxley
O~ley (1790)
(1790) 3 T. R.
R 653
653 would
would not
not have
have been
been overthrown.
overthrown.
Cooke
33
33See
34.
Contracts,p. 34Ashley, COlltracts,
34 O'Brie/£
Boland (1896)
(1896) 166
Mass. 481;
481; Watkins v. Robertson (i9o6)
(1906)
I66 Mass.
34
O'Brien v. Boland
26g; Danbinann
Damb1llall/£ v. Rittler (i889)
(1889) 70
70 Md. 380; McMillan
McMillall v.
105 Va. 269;
if
AtIles (1885)
cases refuse specific
specific performance,
performance, if
(1885) 33 Minn. 257. Some cases
Ames
of
revocation
expressly on the ground of lack of
revocation preceded acceptance, but expressly
consideration,
offer is irrevocable if a conconsideration, and they indicate that the offer
sideration
Corbett v. Cronkhite
Crollkhite (1909)
Crandall v.
(9o9) 239 Ill. 9; Crandall
sideration is paid. Corbett
895; Bishop
89 Va.
v. Brugh
Graybill v.
233; GraJ'bill
Il. 233;
i66 Ill.
Willig (1897)
Willig
(IBg7) 166
Bm!Jh (1893)
(IBg3) 89
Va. 895; Bishop
Contracts,
following
2oo, is the following
p. 200,
Equity, p.
Cases on Eql£it)',
sec. 325. In Ii Ames, Cqses
Contracts, sec.
note: "if after giving an option to buy certain property the giver makes
supposed
aa will
effectuate the supposed
specific property, the courts, to effectuate
devising the specific
will devising
devisee the land, if the option is not
intention of
not
the testator, give to the devisee
of the
intention
exercised,
the proceeds, if the holder or
ol the option elects to buy.
and the
exercised, and
(1848) 2 De G.
Drant
Emuss v. Smith (1848)
58o; EtIluss
& Coll. 580;
(1842) I1 Y. &
Vause (1842)
Drant v. Vause
[1895] I Ch.
re Pyle [IBgS]
In re
& Sm.
Isaacs [IBg4]
51o; III
5o6, 510;
[x894] 3 Ch. 506,
re Isaacs
722; In re
Sm. 722;
subsequent
724."
724." The devise is an apparent act of revocation, but aa subsequent
acceptance
performance.
specific performance.
is entitled to specific
acceptor is
and the acceptor
acceptance is effective, and
Butler
(159I) 3 Coke, 25 a, 26 b, presents a good
Case (1591)
Baker's Case
and Baker's
Butler alld
illustration
B
obligation to B
an obligation
makes all
A makes
irrevocable power: "If A
an irrevocable
illustration of an
and
this is the deed of A presently; but
delivers it to CC to the use of B, this
and delivers
if
the obligathereby the
and thereby
pais, and
in pais,
B may refuse it in
there B
B, there
to B,
C offers itit to
if C
tion
covenant, delivered in escrow, conis aa covenant,
This is
force." This
lose its force."
will lose
tion will
HeinOnline -- 26 Yale L.J. 187 1916-1917
188
YALE LAW
LAW JOURNAL
JOURNAL
YALE
revoke given
given for
for aa consideration
consideration or
or under
under seal.
seal. In
In such
such case
case the
the
revoke
offeror isis never
never privileged
privileged to
to revoke,
revoke, and
and he
he may
may not
not even
even have
have
offeror
the legal
legal power.
power. It
It may
may be
be said
said that
that these
these are
are contracts
contracts and
and
the
are not
not mere
mere offers;
offers; but
but the
the fact
fact remains
remains that
that in
in all
all such
such cases
cases the
the
are
act of
of the
the offeror
offeror has
has conferred
conferred upon
upon the
the offeree
offeree aa power
power to
to
act
create future
future relations,
relations, aa power
power that
that isis in
in all
all respects
respects similar
similar to
to
create
the power
power conferred
conferred by
by any
any offer,
offer, aa power
power to
to -be
'be exercised
exercised by
by the
the
the
voluntary act
act of
of the
the offeree
offeree alone.
alone. The
The offeree
offeree is
is not
not bound
bound to
to
voluntary
do the
the act
act that
that constitutes
constitutes the
the condition
condition or
or acceptance;
acceptance; but
but if
if he
he
do
does do
do that
that act,
act, new
new contractual
contractual relations
relations are
are created.
created. When
When the
the
does
courts enforce
enforce the
the duties
duties included
included among
among these
these relations, they
they do
do
courts
so expressly
expressly on
on the
the theory
theory that
that there
there was
was an
an offer
offer that
that could
could
so
not be revoked.35
not
3~
ditional only
only upon
upon B's
B's assent.
assent. A
A has
has no
no power of revocation, as is
is
ditional
universally held.
held. It
It is
is due
due to
to the
the fact that
that B's
B's power
power is
is irrevocable that
that
universally
the courts
courts have
have called
called the
the existing
existing relations
relations aa contract,
contract, aa tendency noticethe
able in
in other
other cases.
cases. See
See notes
notes 41
41 to
to 47,
47, below.
below. Some
Some will maintain that
that
able
in this
this case
case B
B has
has aa right;
right; but
but if
if so,
so, he
he also
also has
has the
the power
power to
to destroy
destroy
in
it by
by aa mere
mere expression
expression of
of dissent,
dissent, and
and this cannot be
be said of
of contract
contract
it
rights in
in general.
general.
rights
3 In
In O'Brien
O'Brien v.
v. Boland,
Boland, supra,
supra, the
the court
court said:
said: "In
"In the present case,
3~
because
the offer
offer was
was under
under seal,
seal, it
it was
was an
an irrevocable
irrevocable covenant, condibecause the
tional upon
upon acceptance
acceptance within
within ten
ten days,
days, and
and the
the written
written acceptance
acceptance within
within
tional
that time
time made
made it
it aa mu.tual
mutual contract
contract which
which the
the plaintiff can enforce." In
that
Guyer v.
v. Warren
Warren (18gB)
(1898) 175
175 III.
IIl. 328,
328, it
it is said: "The covenant in
in the
the
Guyer
present contract,
contract, giving
giving an
an option
option to
to purchase,
purchase, was in the nature of a
present
continuing offer
to sell."
sell." In
In Willard
Willard v.
v. Tayloe
Tayloe (1869)
(1869) 88 Wall (U. S.)
S.)
continuing
offer to
557, Justice
Justice Field
Field said:
said: "The
covenant in
in the
giving the
right or
557,
"The covenant
the lease
lease giving
the right
option
to purchase
purchase the
the premises
premises was
was in
in the
the nature
nature of a continuing offer
option to
offer
to sell.
sell. It
was aa proposition
proposition .. .. .. .. from
from which
which the
not
to
It was
the defendant was not
at liberty
liberty to
to recede."
recede."
at
On
the other
other hand,
(1888) 147
Mass. 304,
Mr.
On the
hand, in
in Mansfield
lffansjield v.
v. Hodgdon
HodgdOl~ (1888)
147 Mass.
304, Mr.
Justice
Holmes
said:
"The
defendant's
undertaking
Justice Holmes said: "The defendant's undertaking not
not having
having been a
mere offer,
him irrevocably
irrevocably to
mere
offer, but
but aa conditional
conditional covenant
covenant to
to sell,
sell, bound
bound him
sell
in
case
the
plaintiff
should elect
elect to
buy."
sell in case the plaintiff should
to buy."
In
In Galton
Galton v.
v. Emuss
ElIIuss (1844)
(1844) II Coll.
Coli. 243,
243, one
one Nash contracted
contracted with
Galton
that he
"have the
Galton that
he should
should "have
the offer,
offer, for twelve months, of both
both the
estates
by the
estates .. .. .. .. by
the trustees
trustees under
under the
the will
will of
of the
the said John
John Nash."
Later
Later Nash
Nash devised
devised the
the estates
estates to
to the
the trustees,
trustees, defendants,
defendants, for
for other
other uses
uses
and
and with
with no
no power
power to
to convey
convey to
to the
the plaintiff.
plaintiff. The
The trustees
trustees refused
refused to
to
offer
offer the
the estates
estates to
to the
the plaintiff
plaintiff on
on the
the agreed
agreed terms,
terms, but
but the
the plaintiff
plaintiff
gave
gave them
them notice
notice of
of this
this intention
intention to
to purchase.
purchase. Vice
Vice Chancellor
Chancellor Knight
Knight
Bruce
decreed
specific
Bruce decreed specific performance.
performance.
In
In Jordan
Jordal~ v.
v. Dobbins
Dobbins (1877)
(1877) 122
122 Mass.
Mass. 168,
168, aa conditional
conditional covenant
covenant was
was
held
held to
to be
be revocable.
revocable.
HeinOnline -- 26 Yale L.J. 188 1916-1917
OFFER
OFFER AND
AND ACCEPTANCE
If
there is in
in fact aa promise
promise to
to keep
keep the
the offer open
open for a
If there
of revocation
revocation should
should turn upon
upon the
the
specified time, the
the question
question of
specified
of consideration
consideration and
and upon the question of
of damages.
damages. If
If
matter of
matter
there is an agreed
agreed equivalent
equivalent given
given for the promise,
promise, a repudiation
repudiation
there
damages. The
The same
same result
result
will beyond
beyond doubt
doubt create
create a right
right to damages.
will
would be reached
reached where
where the
the offeree
offeree has
has done
done detrimental
detrimental acts in
in
would
reasonable reliance
reliance upon the promsie in those courts adopting
adopting
reasonable
6
Further, in
consideration.336
in
(so-called) estoppel
estoppel theory
theory of consideration.
the (so-called)
this case
the
case the offer
offer should
should be held to be irrevocable
irrevocable and the
the promise
promise to
to be wholly
wholly without
without the
the effect
effect
repudiation of the
repudiation
if a subsequent
subsequent acceptance
acceptance does
does not unreasonably
unreasonably
intended, if
increase
suffered by reason of the breach.
breach. In
increase the
the damages
damages to be suffered
the offer would be
be irrevocable
irrevocable in the
the first (and
(and the
this case, the
contract has
has been made,
made, a repudiation
repudiation by
by
best) sense. After a contract
best)
of the parties creates
creates in the other only
only a right
right to such
such
one of
wiII suffer
suffer after
after taking
taking all
all reasonable
reasonable steps for
for
damages as he will
damages
performance by him will
If further performance
the prevention
prevention of damage. If
wiII
increase his loss, the other
other party is under no duty to pay the
increase
37
damages
But if such
such
damages caused
caused by such further performance.
performance.37
increase his loss, he may proceed
proceed with his
wiII not increase
action will
performance without
without affecting
affecting his claim
claim to damages. In
performance
the cases now being
being considered,
considered, whether
whether they be regarded
regarded as
as
offer open or as conditional
conditional covenants, the
contracts to hold an offer
contracts
execuirrevocable if the execupower conferred
conferred should
should be regarded as irrevocable
power
suffered
pO\ver does not increase
increase the damage to be suffered
tion of the power
in case of breach.
breach. Such
Such damages
damages are not increased in any
the condirespect
if the act of acceptance
acceptance or the fulfilment of ·the
respect if
merely in the giving of a notice or the making of a
tion consists merely
still
promise.
promise. In spite of an attempted revocation, the offeree stiII
acceptance; while the offeror lacks not only
only
has the power of acceptance;
the privilege of revoking, but also the power to revoke. Thus,
B's
suppose that A should offer
offer to convey Blackacre
Blackacre in return
return for B's
suppose
considfor
a
should
promise
promise to pay a price named, and
promise
considpromise
eration or under seal not to withdraw the offer for 30
3o days. In
the power) would
such a case, acceptance
exercising ·the
acceptance (the act of exercising
such
would
making of a promise to pay the price. This would
be merely the making
refused
The Illinois
Illinois Court
Court refused
30 Or.
Or. III.
ini. The
v. Grayson
Grayson (I8g6)
(18g6) 30
86 See
See Clamo
Clarno v.
36
Corbett v. Cronkto hold that such aa reliance made the offer irrevocable. Corbett
(19o9) 239 Ill. 9.
hite (1909)
37 Clark
Clark v.
V. Marsiglia
Marsiglia (1845)
(1845) Ii Den. (N. Y.)
Y.) 317; A1IIerical~
American Pub.
37
Pub. Co.
(1901) 87 Mo. App. 503.
v. Walker (igoi)
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YALE LAW
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YALE
not in
in any
any respect
respect increase
increase the
the damage
damage suffered
suffered by
by reason
reason of
of aa
not
breach. B's
B's damages,
damages, whether
whether for
for breach
breach of
of the
the preliminary
preliminary
breach.
option contract,
contract, or
or for
for breach
breach of
of the
the subsequently
subsequently created
created contract
contract
option
to convey,
convey, would
would be
be the
the value
value of
of Blackacre,
Blackacre, less
less the
the contract
contract price.
price.
to
In cases
cases where
where B's
B's damage
damage isis regarded
regarded as
as irreparable,
irreparable, he
he should
should
In
be given
given aa decree
decree for
for specific
specific performance
performance in
in equity.
equity. The
The same
same
be
conclusion follows
follows if
if the
the transaction
transaction be
be regarded
regarded as
as a covenant
covenant
conclusion
to convey
convey Blackacre
Blackacre on
on condition
condition that
that aa promise
promise by
by BB to
to pay
pay the
the
to
38
price shall
shall be
be made
made within
within 30
30 days.
days.3s
price
that A offers
offers to
to pay
pay $5,000
$5,000 to
to B
B in
in return
return
Suppose, however,
however, that
Suppose,
obstructs
that
for
the
destruction
by
B
of
a
valuable
building
that
obstructs
building
a
valuable
of
B
by
for the destruction
A's view,
view, giving
giving BB aa 3o-day
30-day option
option as
as before.
before. If
If in
in this
this case
case
A's
(or
A
gives
notice
of
repudiation,
B's
power
of
acceptance
(or
acceptance
of
power
B's
repudiation,
A gives notice of
conof
creating
new
contractual
relations
by
fulfilment
of
the
conthe
of
fulfilment
by
relations
contractual
of creating new
dition) is
is destroyed.
destroyed. The
The act
act of
of acceptance
acceptance is
is here
here a very
very
dition)
cannot
B
expensive
one
and
would
greatly
increase
the
loss.
B
cannot
loss.
the
increase
greatly
would
expensive one and
maintain an
an action
action of
of debt for
for $5,ooo,
$5,000, for
for the destruction
destruction of the
the
maintain
be
now
building
was
the
pro
fulfilment
would
now
be
would
fulfilment
its
and
quo
pro
quid
building was the
being
unjustifiable.
B's
remedy
is
in
assumpsit
for
damages,
being
damages,
for
assumpsit
in
remedy is
unjustifiable.
$5,000, less the
the value
value of the
the building
building saved. Even
Even in
in a case
case of
of
$5,ooo,
this sort, if A has promised
promised to
to convey
convey Blackacre,
Blackacre, instead of to
to
as
about
pay
money,
and
the
breach
of
promise
regarded
as
about
regarded
is
promise
his
breach of
pay money,
to cause B irreparable
irreparable injury, equity
equity would no doubt
doubt approve
approve
the destruction
destruction of the building
building and would
would decree
decree specific
specific performance of A's promise.
promise. In such a case, A's offer is clearly
clearly
formance
irrevocable,
in
the
true
meaning
of
that
term.
that
of
meaning
irrevocable, in the true
Specific Performance.
performance in
Performance. An obstacle to specific performance
supposed to exist in case the option (let us
equity may be supposed
suppose an option
option to buy) is a contract
contract to hold an offer open
open
suppose
instead of a conditional
covenant or simple contract. In the
conditional covenant
instead
obligation to convey, and this
latter case there is a completed
completed obligation
enforced. In the former case there is no such obligation,
obligation,
may be enforced.
and none can be made because the option contract has been
been
broken and the offer has been revoked. This obstacle can be
asserted
avoided by the simple expedient
expedient of not seeing it. The asserted
been disproved
impossibility
impossibility of doing an act has many a time 'been
change the
by doing it. If
If by definition the thing is impossible, change
in two ways:
verbally in
definition. The objection can be met verbally
irrevocable and the
first, by
by the easy method of declaring the offer irrevocable
38
3S
BIack v.
v. Maddox
Maddox (18gB)
(I898) 104
1o4 Ga. 157;
157; and
and cases
cases in
in note
note J4,
34, supra.
supra.
Black
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OFFER AND
AND ACCEPTANCE
ACCEPTANCE
OFFER
option contract
contract unbreakable.
unbreakable.3399 That
That this
this can
can be
be done
done has
has already
already
option
our law
law in the
the
been shown
shown above.
above. There
There is
is nothing
nothing foreign
foreign to
to our
been
of an
an irrevocable
irrevocable power,
power, and
and the
the legal
legal relation
relation resulting
resulting
idea of
idea
The power
power to
to accept
accept being
being still
still
from an
an offer
offer is
is a legal
legal power. The
from
alive, the
the offeree
offeree may
may exercise
exercise itit and
and thus
thus create
create the
the obligation
obligation to
alive,
for specific
specific enforcement.
enforcement. The
The second
second
convey, all
all fit
fit and
and ready
ready for
convey,
of meeting
meeting the
the objection
objection may
may be preferred
preferred *by
by some, but it
it is
is
form of
form
option contract
contract
the same
same in
in essence.
essence. Everybody
Everybody agrees
agrees that the option
the
obligation that is
is enforcible.
enforcible. It
It may
may be
be described
described as
as aa
creates an obligation
creates
if the
the second
second contract-the
contract-the
contract to make
make a contract.
contract. Even
Even if
contract
obligation to
to convey-is
convey-is never
never formed, equity
equity still
still has
has jurisdiction
jurisdiction
obligation
Nor is itit
ground that money
money damages
damages are
are inadequate.
inadequate. Nor
on the ground
without the power to enforce
enforce a decree.
decree. Even
Even if we suppose
suppose that
that
without
equity cannot
cannot specifically
specifically enforce
enforce the contract
contract to make a contract,
contract,
equity
it can do
do exactly
exactly what
what itit does in all of
of its decrees
decrees for specific
specific
it
can decree
decree specific
specific reparation.
reparation. In
In this case
case a
performance: itit can
performance:
of the
the property
property would
would be such reparation,
reparation, for it was
was
conveyance of
conveyance
the option
option contract. Nobody doubts the
the ultimate
ultimate object
object of the
power of equity
equity to force a conveyance
conveyance of the res and
and to compel
compel
power
new rights in rem, even though many
many have supthe creation
creation of new
40
personam.4.0
Indeed,
posed that this can be
be done only
only by acting
acting in personam.
Indeed,
individuals should doubt the
it seems
seems strange
strange that these same individuals
equity to compel
compel the creation
creation of a new
new obligation
obligation in
power of equity
power.
of
an
irrevocable
personam,
through
the
medium
irrevocable
medium
personam, through
other
There are still other
Limitations Due to Part
Part Performance.
Performance. There
Limitations
it
has
sometimes
-been
held
that
an
offer
is
irrevocable,
cases
where
sometimes been
cases where
even though there is no express promise to hold the offer
offer open.
be
accepted
can
accepted
These are offers made in such terms that they
requiring an appreciable
appreciable
performing a series
series of acts requiring
only by performing
expense. Upon complete performlength of time and effort or expense.
irrevocable
acceptance becomes irrevocable
ance of these acts, the power of acceptance
resulted;
because it has been fully executed
executed and a contract has resulted;
but in a few cases it has been held, contrary to what is generally
becomes irrevocable
irrevocable after
supposed to be the rule, that the offer becomes
the offeree has begun to perform the requested acts of acceptance
39
a legal
39 Langdell said that a contract incapable of being broken "is also a
impossibility;" Summary of COllt.,
statement,
Cont., sec. 178. He rested his statement,
however, upon the premise that no offer could be irrevocable.
point see the excellent article on The Powers
40 For an elucidation of this point
4.0
Walter
of Courts of Equity,
io6, 228, by Professor Walter
37, 106,
REv. 37,
L. REv.
Equity, in 15 COL. L.
Wheeler Cook
Cook of the Yale School of Law.
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has performed
performed a substantial
substantial part of such acts."
acts.u It must
must
or has
be observed
observed that
that after such a part
part performance
performance there
there is as
as yet
yet
be
no contract,
contract, for by
by hypothesis
hypothesis acceptance
acceptance was
was to
to consist
consist of
of
no
complete performance.
performance. If
If the offer has
has become
become irrevocable,
irrevocable,
complete
offeree still
still has
has the power
power to create
create aa contract
contract by
by
however, the offeree
completing the requested
requested acts, in spite of a notice
notice to the
the contrary
contrary
completing
from the offeror. The principle
principle applied in these cases
cases is applicaapplicafrom
merely to offers
offers of unilateral
unilateral contracts, but also
also to offers
ble not merely
where the offeree
offeree is requested
requested to make a return
return promise and to
where
express it
it by
by one
one or more acts
acts requiring
requiring a considerable
considerable expendiexpendiexpress
ture of time
time or money. The cases
cases in point, however, are
are mostly
mostly
ture
cases of
of offers to
to make
make a unilateral contract.
contract.
cases
In
In one case, the
the defendant
defendant offered
offered a reward
reward for the arrest
arrest and
and
conviction of
of some
some criminals.
criminals. The
The plaintiff
plaintiff arrested
arrested them and
and
conviction
induced their
their confession,
confession, but they were
were not convicted
convicted because the
induced
defendant wished to use their testimony
testimony in
in other
other cases
cases and
and so
so
defendant
had the indictments dismissed. It
It was held that the plaintiff was
was
42
entitled to the reward. 42
entitled
Again, a defendant
defendant delivered
delivered a negotiable
negotiable note in escrow
escrow for
the plaintiff, to be paid when the plaintiff
plaintiff had completed
completed a line
performance by the plaintiff
of railway. After
After part performance
plaintiff the derevocation. The courtheld
court .held this notice to
fendant gave notice of revocation.
thereafter
"it would be manifestly
manifestly unjust thereafter
be ineffective,
ineffective, saying: "it
to permit
permit the offer
offer that had been made to be withdrawn. The
promised consideration
consideration had
had been partly performed,
performed, and the
character." 43
contract
contract had taken
taken on a bilateral
bilateral character."43
70
Rittler (1889)
41Hoze v.
v. Beeche
41Howe
Beeche (1685)
(1685) 33 Lev.
Lev. 244;
244; Daminbmann
Damblllallll v.
V. Rittler
(188g) 70
Md. 380, may be such a case, although the court treats the case as if there
court
were a conditional
conditional contract
contract to deliver at the buyer's option. The court
states a promise
promise by defendant to deliver from 300 to 500 tons of phosphate,
the plaintiffs to give 24 hours'
hours' notice of their wants. No promise by the
had been
After 300 tons had
consideration, is
is stated.
stated. After
plaintiff, or other consideration,
been delivdelivrepudiated further obligation;
ered, the defendants repudiated
obligation; but the court held
held
the defendants bound to fill later orders. See following notes.
42
552.
(1874) 10
IO Bush
(Ky.) 552.
Co. v.
v. Goodnight
Goodnight (1874)
& N.
N. R.
42 Louisville
Louisville &
R. Co.
Bush (Ky.)
v..
2o Kan. 123; Stephens
Stephens OZ'
Dysert (1878)
(1878) 20
Stone v. Dysert
Similar cases are: Stolle
492;
Stone (1900)
(igoo) io8
Brooks (1867)
(1867) 2 Bush (Ky.)
(Ky.) 137; Mosley v. Stolle
loS Ky. 492;
(1887)
Contra, Biggers
U. S. (1876)
(1876) 12 Ct. Cl. 192. COlltra,
Williams v. U.
Williams
Biggers v. Owen (1887)
79 Ga. 658.
43Los
Wilshire (1902)
(i9o2) 135
135 Cal. 654; if the note
43
Los Angeles
Allgeles Traction
Tractiolt Co. v. Wilshire
can be regarded as a specialty, the decision is supported by the principle
Hinton (1881)
(i88i) 7
Gray v. HilltOIl
Baker's Case,
Case, supra,
supra, note 34; cf. Gray
Butler alld
and Baker's
of Butler
8r.
Fed. 81.
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ACCEPTANCE
OFFER
193
In another
another case,
case, aa corporation
corporation passed
passed aa by-law
by-law providing
providing that
that
In
after
employees should
should be
be entitled
entitled to
to aa share
share in
in the
the profits
profits after
employees
serving for
for aa named
named period.
period. The
The plaintiff
plaintiff was
was discharged
discharged
serving
one day
day before
"before he
he would
would have
have been
been entitled
entitled to
to share
share under
under this
this
one
His action
action for
for such
such share
share was
was sustained,
sustained, the
the court
court
by-law. His
by-law.
"It isis true
true as
as aa general
general proposition
proposition that
that aa party
party making
making
saying: "It
saying:
an offer
offer of
of a reward
reward may
may withdraw
withdraw it
it before
before itit is
is accepted.
accepted. But
But
an
persons offering
offering rewards
rewards must
must be
be held
held to
to the
the exercise
exercise of
of good
good
persons
and cannot
cannot arbitrarily
arbitrarily withdraw
withdraw their
their offers
offers for
for the
the purpose
purpose
faith and
faith
44
of defeating
defeating payment."
payment."44
of
put on
on at
at Gap
Gap
A defendant
defendant offered
offered to
to buy
buy all
all railroad
railroad ties
ties "you
"you put
A
next twelve
twelve months."
months." The
The plaintiff
plaintiff had
had supplied
supplied"
within the
the next
within
1,000 ties
ties and
and had
had secured
secured material
material for 5,000
5,000 more, when
when the
the
I,ooo
of revocation.
revocation. The
The court
court held
held the
the plaintiff
plaintiff
defendant gave
gave notice
notice of
defendant
to damages
damages for failure
failure to
to take
take the
the remaining
remaining 5,000
5,000
to be
be entitled
entitled to
to
45
ties.45
If an owner
owner has offered
offered a commission
commission to aa real
real estate
estate broker,
broker,
If
after
to be earned
earned by effecting
effecting a sale,
sale, can the
the offer
offer be
be revoked
revoked after
the broker
broker has spent
spent time
time and
and money
money and
and may
may have
have aa sale
sale nearly
nearly
In such
such a case
case the courts are
are very ready
ready to
consummated? In
consummated?
make the assumption that there was a bilateral
bilateral contract, for
for
the
that
or
that
the
breach
of
which
entitled
to
damages,
entitled
is
the
broker
breach
of
the
broker
were
completed,
the
acceptance
and
services
and
valid,
acceptance
the broker were completed,
services
the reward
reward earned."
earned.46
Suppose a prize is offered
offered to the winner
winner of a race or to the
Suppose
specified rules;
winner of a voting or guessing contest, under
under specified
rules;
can the rules be changed or the offer be withdrawn by the offeror,
offeror,
contestants? There
after substantial acts in reliance thereon by contestants?
v. Baker Mfg.
150 Wis. 517.
(1912) 150
Mfg. Co. (1912)
45 Louisville
123 Ky. 854; cf. Rehm-Zeiher
(igo6) 123
Louisville & N. R. Co. v. Coyle (1906)
45
Co.
156 Ky. 6.
(1913) 156
Co. v. Walker (1913)
46 See Blumenthal v. Goodall
Goodall (ISgI)
(1891) Sg
89 Cal.
Cal. 251. Where aa definite time
46
was
sale, the broker cannot earn his reward
was fixed for the making of the sale,
75
Alltisell (1888)
by completing the service after the time. Zeimer
(1888) 75
v. Antisell
Zeiner v.
Cal.
for a reasonable time, and the
If the offer has been held open for
50g. If
Cal. 509.
broker
offer
attempt, the offer
after aa definite attempt,
service after
to render the service
failed to
has failed
broker has
has
faith."
if the defendant is acting "in good faith."
has been said to be revocable "if
83 N. Y.
See
v.
Cadigan tl.
378; Cadigalt
Y. 378;
(i88r)
Co. (1881)
Iron Co.
Sibbald v. Bethlehem Irolt
See Sibbald
Crabtree
Md. 337. The
(1883) 61 Md.
Miller (1883)
v. Miller
186 Mass. 7; Livery v.
(9o4) 186
Crabtree (1904)
unreainference
revocation made unreathat aa revocation
be drawn from these cases that
may be
inference may
sonably
ineffective.
would be ineffective.
faith" would
or "in bad faith"
sonably or
Zwolanek
44 Zwolallek
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YALE LAW
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are cases
cases tending
tending to
to justify
justify an
an inference,
inference, though
though not
not deciding,
deciding,
are
4 T
that the
the offer
offerhas
has become
become irrevocable.
irrevocable.4'T
that
reward has
has been
been offered
.offered for
for the
the return
return of
of aa lost
lost
\iVhere aa reward
Where
article,
it
has
been
held
that
the
finder
has
a
Hen
on
the
article
article
the
on
lien
a
has
finder
the
that
held
been
has
it
article,
to compel
compel payment
payment of
of the
the reward,
reward, without
without stopping
stopping to
to consider
consider
to
47
a
delivery.
before
earned
been
has
whether
or
not
the
reward
has
been
earned
before
delivery:l111
reward
the
not
or
whether
apparent that
that the
the offer
offer has
has become
become irrevocable
irrevocable before
before
ItIt isis apparent
delivery.
delivery.
The rule
rule that
that offers
offers like
like the
the foregoing
foregoing are
are revocable
revocable at
at any
any
The
has
requested
time
prior
to
complete
performance
of
the
acts
requested
has
acts
the
of
time prior to complete performance
448
8
find
to
encountered
some
criticism.
Sometimes
a
court
is
astute
to
find
is
astute
court
Sometimes a
encountered some criticism.
9
. that
that in
in fact
fact there
there was
was no
no revocation.
revocation.4 40
In many
many instances
instances the
the
In
close
without
existence
of
a
bilateral
contract
has
been
assumed
without
close
existence of bilateral contract has been assumed
0
of the
the facts,
facts, in
in order
order to
to render
render aa revocation
revocation ineffective.
ineffective. GO
analysis of
analysis
47
4'T Mooney
Moo1ley v.
v. Daily
Daily News
News Co.
CO. (1911)
(19II) 116
II6 Minn.
Minn. 212;
212: Minton
Millton v.
v. Smith
Smith
305.
S.)
CO.
(19II)
36
App.
Cas.
(D.
C.)
137,
33
L.
(N.
S.)
305.
Piano
(N.
A.
L.
R.
33
137,
C.)
(D.
Piano Co. (1911) 36 App. Cas.
47a
4111 Wood v.
v. Pierson
Pierso11 (1881)
(1881) 45
45 Mich.
Mich. 313;
313: Wentworth
Wentworth v.
v. Day
Day (1841)
(1841) 33
Wils011 v.
1i. Guyton
Guyton (1849)
(1849) 88 Gill
Gill (Md)
(Md) 213,
213, semble;
semble;
Met. (Mass.)
(Mass.) 352;
352: Wilson
Met.
see also
also Cummings
Cummillgs v. Gann
Gatm (1866)
(1866) 52
52 Pa.
Pa. St. 484.
see
48
48 Wald's
Wald's Pollock,
Pollock, Contracts
Contracts (3d
(3d ed.)
ed.) p. 34,
34, note
note ("the
("the result
result is
is harsh");
harsh") :
Contracts,
sec.
13:
W.
Contracts
(5th
ed.)
sec. 495.
495.
Wharton,
sec.
ed.)
(5th
Contracts
Story,
W.
W.
13;
sec.
Wharton, Contracts,
49 See
See Quick v. Wheeler (1879)
(1879) 78
78 N.
N. Y. 300.
GO There
There are numerous
numerous option
option contracts
contracts where
where the
the acceptance
acceptance prescribed
prescribed
50
payment or some
some other onerous
onerous performance,
performance, but
but the
would seem
seem to be payment
would
court has
has held
held that a mere
mere notice
notice of
of acceptance
acceptance is
is sufficient
sufficient to create
create a
court
bilateral contract.
contract. See Murphy Thompson v. Reid (1907)
585;
125 Ky. 585;
(19o7) 125
bilateral
Rockland-R. Lime Co. v. Leary (IgII)
(19II) 203
203 N. Y. 469;
469: Barrett
Barrett v. McRockland-R.
(1890) 33 W. Va. 738:
Contracts by the writer
Allister (1890)
738; article on Option Contracts
Allister
23 YALE
YALE LAW
LAW JOuRNAL,
JOURNAL, 641.
641. See also the argument in Offord v. Davies
in 23
in
(1862)
S.) 748. Sir Frederick
reviewing Ashley
Ashley
Frederick Pollock, reviewing
12 C. B. (N. S.)
(1862) 12
Contracts in 28
28 LAW
on Contracts
ioo, says: "If this be so (that there
QUART. REv. 100,
LAW QUART.
on
is
completed), the promisor may withdraw
is no acceptance until the act is completed),
capriciously
his offer when the work is all but done, or the promisee may capriciously
leave
leave the work half done, and in either case without remedy, unless there
be something in the circumstances
circumstances which can be made to support an
action of tort.
tort. A carter, for example, who is carrying goods to aa wharf
to be put on an
in the middle of the
outgoing ship, may abandon them in
an outgoing
journey.
that, whataverage lawyer will say that,
man and the average
journey. Both the plain man
ever
cannot be so absurd as
the law really cannot
logic may be, the
Ashley's logic
Prof. Ashley's
ever Prof.
that; and
court before
rational court
any rational
more, any
what is ~ore,
and, what
be right,
right, and,
and they will be
so.
them so.
whom such aa question
make them
will surely find a way to make
question is moved will
It
done
be done
act to be
for an act
on aa request for
acting on
that acting
held that
It might
might easily be held
for
At
performance. At
the performance.
through with the
go through
to go
implies aa promise to
reward implies
for reward
first
the first
by the
all
accepted by
irrevocably accepted
is irrevocably
the offer is
that the
us that
seems to us
all events itit seems
not
does not
fact itit does
unequivocal
requested. In fact
act requested.
the act
commencement of the
unequivocal commencement
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OFFER AND ACCEPTANCE
ACCEPTANCE
OFFER
195
It is
is often
often maintained that the offer
offer is irrevocable
irrevocable after the
It
an act
act that binds him to complete
complete the
the requested
offeree has done an
performance.5G11
It has been suggested that in
in cases
cases of the above
above sort,
sort, even
even in
It
absence of an express
express promise not to revoke an offer, a
the absence
not to revoke is implied,
implied, the consideration therefor
therefor
promise not
whereby the requested performance
performance is
being any substantial act whereby
52
If such an option contract is justly inferable in fact, it
begun. s2 If
is governed by the same rules as an express contract to keep an
offer open. This
This has been discussed above.
above. In many instances,
however, the inference of such a promise would be contrary
contrary to
to
fact. In those cases
cases the promise would be a fiction and the
agreement that the beginning of performance should be the
consideration for this promise would likewise be aa fiction. The
consideration
purpose of such a fiction is to make the offer irrevocable
irrevocable and
and it
it
is based upon a belief as to policy and general
general advantage. If
If
this
is true
true and if in our process of evolution we have become
this is
conscious
to
conscious of the fact, we are ready to discard the fiction and to
express in appropriate words the rule and its reason. It
It might
be expressed somewhat
somewhat like this: Where an offer has been made
so that it can -be
be accepted
accepted only by performing a series of acts
requiring
appreciable length of time and effort or expense,
requiring an appreciable
such offer shall be irrevocable after the offeree has begun the
performance
offeror expressly
expressly
performance of the requested acts, unless the offeror
reserved
the power
power of
of revocation.
revocation."58
reserved the
often happen that
that aa man
man sets about a job without writing or uttering
some
kind of
of word
word of
of acceptance. 'All right' is enough. Thus the
some kind
practical
outcome of
of Prof.
Prof. Ashley's
Ashley's ingenious
be to
practical outcome
ingenious exercise
exercise may
may be
to convince
convince
us that there are fewer unilateral contracts in the world than we supposed."
supposed."
See also'Brol/IIC11bcrg
also Bronnenberg v.
Coburn (1886)
(I886) iO
cases in
in note 14,
v. Coburn
no Ind. 169,
169, and cases
14,
See
supra.
supra.
"'Morrow
Co. (1897)
(1897) 101
ioi Ga. 810;
81o; Plumb v. Campbell
G1Morrow v. So. Express
E:rpress Co.
Contracts (5th ed.)
451. In Lascelles
Lascelles
II Parsons, Contracts
ed.) p. 451.
Clark (191o)
"in
v. Clark
(1910) 204
204 Mass. 362, the defendant offered a guaranty "in
consideration
continuing for the next month the account
account current
current
consideration of your continuing
between
1)." The plaintiff
plaintiff at once
once made an agreement
agreement
between you .. .. .. .. and D."
with D for credit during the month.
month. It
It was held that this completed
completed the
contract
of
Assuming that if acceptance
acceptance were
were to consist of
contract of guaranty. Assuming
acts
covering the
acts covering
the whole
whole month
month the offer would be revocable on the
the 29th
day,
court says:
says: "It
the court
"It cannot
cannot be supposed
supposed that the parties
parties meant that."
day, the
Gelpcke
v.
Quentell (1878)
74
N. Y.
599.
fl. Quelltcll
(1878)
74
Y.
599.
Gelpcke
52
Irrevocable Offers, 27
27 HARv.
654.
liZ McGovney,
McGovne)', Irre\'ocable
HARV. L. Rav.
REV. 65453
in the
Civil Code, sec.
S8 There
There is
is aa similar
similar provision
provision in
the German
German Civil
sec. 658.
658.
(1888)
1oi;
129 Ill. 101;
(1888) 129
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YALE LAW
LAW JOURNAL
JOURNAL
YALE
To this
this rule
rule there
there should
should probably
probably be
be added
added some
some such
such rule
rule
To
will
as
the
following:
If
the
continuation
of
performanec
will
performanec
of
as the following: If the continuation
shall
increase
the
amount
of
the
offeree's
claim,
the
revocation
shall
revocation
the
claim,
increase the amount of the offeree's
be effective;
effective; in
in such
such case
case ifif the
the offeree
offeree can
can show
show with
with reasonable
reasonable
be
shall
he
certainty
that
he
would
have
performed
in
full,
he
shall be
be
full,
in
certainty that he would have performed
aa
been
entitled
to
the
same
damages
as
if
the
contract
had
been
had
entitled to the same damages as54 if the contract
54
beginning.
the
in
bilateral
contract
in
the
beginning.
bilateral contract
Possible Unfairness.
Unfairness. In
In this
this class
class of
of cases
cases the
the question
question isis of
of
Possible
represome
complexity,
and
it
cannot
be
said
that
the
above
rules
reprerules
above
the
that
said
be
it
cannot
and
some complexity,
sent the
the settled
settled law
law of
of any
any jurisdiction.
jurisdiction. There
There isis enough
enough reason
reason
sent
and
authority
in
their
favor,
however,
to
warrant
their
careful
and authority in their favor, however, to warrant their careful
in new
new legislation,
legislation, parliamentary
parliamentary or
or judicial.
judicial. A
A
consideration in
consideration
possible argument
argument against
against such
such rules
rules isis that
that they
they would
would operate
operate
possible
unfairly and
and unequally
unequally as
as between
between offeror
offeror and
and offeree.
offeree. The
The
unfairly
offeree will
will remain
remain free
free to
to discontinue
discontinue performance
performance without
without any
any
offeree
claim for
for damages
damages arising
arising against
against him,
him, while
while the
the offeror
offeror will
will
claim
bear an
an irrevocable
irrevocable liability.
liability. The
The offeree
offeree remains
remains legally
legally priviprivibear
leged and
and empowered
empowered to
to prevent
prevent aa contract;
contract; the
the offeror's
offeror's priviprivileged
lege is
is wholly gone
gone and
and in
in some
some cases
cases his
his power
power of
of revocation
revocation
lege
is gone
gone also.
also. It
It has
has been
been our
our custom
custom to say
say that
that both
both parties
parties
is
must be
be bound
bound or neither
neither is bound,
bound, but
but this properly
properly applies
applies
must
only to transactions
transactions by which it is intended
intended to creat
creat bilateral
bilateral
only
duties. A closer
closer consideration
consideration will show
show that there is no real
duties.
unfairness on this score.
score. The
The offeror
offeror is the one
one who invites
invites
unfairness
action by the offeree,
offeree, and
and he invites
invites it in such
such a way that the
action
offeree bears
bears all the
the risk
risk of loss. The offeror
offeror will
will have to pay
offeree
is
acceptance is not fully completed, and if it is
nothing if the acceptance
received the requested
requested equivalent
equivalent for his
completed he has received
so completed
promise. The offeror
offeror has asked
asked for no rights against
against the offeree
and has invested nothing
nothing in the hope of such rights and has
been induced to do expensive
reliance upon such expecexpensive acts in reliance
tation. The offeree may find eventually, after much labor and
54
contained in the Swiss Code
Code
in some respects like this is contained
provision in
A provision
54 A
of Obligations, sec.
sec. 8.
55
ren
in rem
confer rights il~
acceptor's performance may confer
the acceptor's
that the
55 It
It is true that
such
upon the offeror
the hope of such
in the
investments in
may have made investments
and he may
offeror and
the
may be the
offeree may
of the offeree
the acts of
rights. Also,
Also, as stated previously, the
the offeror hopes
prescribed
in which case the
promise, in
prescribed mode of expressing aa promise,
believed
not believed
is not
It is
for
would be aa rare case. It
this would
personam; this
in personam,'
right il~
for aa right
desirable)
that
separate rule might be desirable)
which aa separate
cases (for which
exceptional cases
these exceptional
that these
affect
above.
argument above.
the argument
of the
validity of
the validity
affect the
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OFFER AND
AND ACCEPTANCE
ACCEPTANCE
OFFER
197
expense, the
the complete
complete acceptance
acceptance by
by him
him isis impossible
impossible or
or so
so
expense,
expensive
as
to
exceed
the
offered
compensation.
Complete
expensive as to exceed the offered compensation. Complete
acceptance may
may become
become impossible
impossible by
by reason
reason of
of aa third
third party's
party's
acceptance
previous
acceptance
of
the
offer.
From
this
it
appears
that
previous acceptance of the offer. From this it appears that itit isis
fair enough
enough for
for the
the one
one who
who bears
bears the
the risk
risk to
to possess
possess the
the privilege,
privilege,
fair
while
the
other,
bearing
no
risk,
is
deprived
of
both
privilege
while the other, bearing no risk, is deprived of both privilege
58
and
power.
and power. 56
Termination of
of Power
Power by
by Offeree.
Offeree. The
The power
power created
created by
by an
an
Termination
offer
may
be
terminated
not
only by
by the
the offeror
offeror but
but also
also by
by the
the
offer may be terminated not only
offeree, the
the possessor
possessor of
of the
the power.
power. His
His mere
mere failure
failure to
to exerexerofferee,
cise the
the power
power will
will not
not in
in itself
itself cause
cause such
such aa termination,
termination, except
except as
as
cise
such aa failure
failure fulfils
fulfils aa condition
condition prescribed
prescribed by
by the
the offeror or
or by
by
such
the law.
law. If
If the
the offeror
offeror has
has expressly
expressly limited
limited the
the life
life of
of the
the
power, he
he has
has thereby
thereby caused
caused aa failure
failure to accept
accept within the
the
power,
prescribed period
period to
to be
be an
an operative
operative fact.
fact. If
If the
the power
power to
to
prescribed
accept is
is limited
limited by
by the
the law
law to
to aa "reasonable
"reasonable time," the
the law has
has
accept
caused failure
failure to
to accept
accept to
to be
be an
an operative
operative fact.
fact. However, in
caused
such cases
cases it
it would
would be
be more
more in
in accord
accord with the instinct
instinct of the
such
average man
man to
to designate
designate the
the act
act of the offeror as
as the
the cause
cause
average
both
of
the
birth
of
the
power
to
accept
and
of
its
death.
both of the birth of the power to accept
of
death.
It is
is usually
usually said
said that
that the
the power
power of
of acceptance
acceptance is terminated
terminated by
It
the
act
of
the
offeree
in
definitely
rejecting
the
offer
or in
in making
the act of the offeree in definitely rejecting
a
conditional
acceptance
or
counter
offer.
This
is
not
necessarily
a conditional acceptance or counter offer.
true. The
The offeror
offeror is
is the
the creator
creator of
of the
the power
power and
and he may cause
true.
it
to
live
in
spite
of
rejections
and
counter
offers.
If the offeror
offeror
it to live in spite of rejections and counter offers. If
should
make
an
offer
and
at
the
same
time
notify
the
offeree
should make an offer and at the same time notify
that
the
power
to
accept
shall
exist
for
two
weeks
and
that a
that the power to accept shall exist
rejection
or
counter
offer
shall
not
terminate
it,
it
can
hardly
rejection or counter offer shall not terminate it, it can hardly
be
expected that
that aa court
court would
would disregard
be expected
disregard the offeror's expressed
intention.
The
offeree
may
still
intention. The offeree may stilI reasonably
reasonably believe
believe the offer to be
open.
The
same
result
should
follow,
even
in the absence
open. The same result should follpw, even in
absence of an
an
express
notice,
if
the
offeror
has done any other overt acts
express notice, if the offeror has
expressing
such an
an intention.
expressing such
intention. The
The real
real reason
reason why
why a rejection
or
a
counter
offer
should terminate
tion or a counter offer should
terminate the
the power
power to
to accept
accept
"The reason for making an offer irrevocable given in deBecker's
56 The reason for making an offer irrevocable given in deBecker's
Annotated
of Japan,
Japan, art.
art. 521,
521, is:
is: "the
"the offeror
offeror cannot
cannot freely
Annotated Civil
Civil Code
Code of
withdraw
of time,
time, because
because the
the other
other
withdraw his
his offer
offer within
within the
the specified
specified period
period of
party
and if
party may
may require
require to
to make
make some
some preparations
preparations for
for accepting
accepting it,
it, and
after
after he
he had
had made
made those
those preparations
preparations and
and was
was about
about to
to accept
accept the offer,
offer,
the
might cause
cause aa great
great deal
deal of
of
the offeror
offeror suddenly
suddenly withdrew
withdrew the
the offer,
offer, itit might
prejudice
prejudice and
and annoyance
annoyance to
to the
the other
other party."
party."
IS
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198
YALE LAW
LAW JOURNAL
JOURNAL
YALE
seems to
to be
be the
the effect
effec,t that
that they
they will
will probably
probably have
have upon
upon the
the
seems
thought and
and actions
actions of
of the
the offeror.
offeror. If
If in
in the
the particular
particular case
case they
they
thought
have had
had no
no effects
effects whatever-and
whatever-and the
the party
party asserting
asserting rights
rights
have
under aa contract
contract must
must be
be able
able to
to show
show this-it
this-it should
should be
be held
held that
that
under
the power
power continues
continues to
to exist.
exist. If,
If, after
after aa rejection
rejection or
or counter
counter
the
offer, the
the offeror
offeror has
has done
done no
no overt
overt act
act prior
prior to
to the
the subsequent
subsequent
offer,
act of
of acceptance,
acceptance, indicating
indicating with
with reasonable
reasonable certainty
certainty that
that he
he
act
intends the
the power
power still
still to
to exist,
exist, no
no doubt
doubt it
it would
would be
be held
held that
that
intends
such an
an acceptance
acceptance has
has only
only the
the effect
effect of
of aa new
new offer;
offer; otherwise
otherwise
such
the acceptor
acceptor would
would be
be wholly
wholly at
at the
the offeror's
offeror's mercy,
mercy, for
for the
the latter
latter
the
could prove
prove the
the overt
overt acts
acts of
of acceptance,
acceptance, but
but the
the acceptor
acceptor could
could
could
not prove
prove that
that the
the offeror
offeror had
had continued
continued to
to hold
hold the
the offer
offer open.
open.
not
If the
the offeror
offeror has
has in
in fact
fact done
done an
an overt
overt act
act indicating
indicating his
his
If
intention to
to continue
continue the
the existence
existence of
of the power,
power, there
there seems
seems
intention
to be
be no
no practical
practical necessity
necessity for
for aa notice
notice of
of such
such act
act to
to be
be given
given
to
to the
the offeree,
offeree, except
except that
that without
without such
such a notice
notice he
he may
may never
never
to
accept. If
without such
such a notice
notice he does
does accept,
accept, he is still being
being
If without
accept.
induced to
to act
act by the original
original notice.
notice. He
He is acting
acting in
in accordance
accordance
induced
with a power
power that
that he
he thinks
thinks he
he has,
has, and
and that
that he has
has in fact. If
If
with
can prove
prove the facts as
as against
against the offeror,
offeror, the latter should
should
he can
be bound.
bound. The offeror
offeror will have no difficulty
difficulty in
in proving
proving the
against the offeree, for he
he has evidence
evidence of
of the
the acceptance
acceptance
facts as against
and also of
of his own
own overt
overt act
act continuing
continuing the
the power.
power.
and
by Death or Insanity.
Insanit3', The general rule is that the
the
Revocation by
acceptance is terminated
terminated by the death or by
by the superpower of acceptance
power
vening insanity
insanity of either
either the offeror
offeror or the offeree. This rule also
also
vening
may be in harmony
harmony with the public interest;
interest; but there is not,
as is often
often supposed, any compelling necessity
necessity for its existence.
It
may
be
said
that
you
cannot
contract
cannot contract with a dead man; but
It
contracted
neither can you force a dead man to pay his debts contracted
before his death. Yet the law has no difficulty, in the latter case,
in creating
creating legal relations
relations with the dead man's personal representative, and there would be no greater difficulty in declaring the
power of acceptance
acceptance to survive as against the offeror's representaagain
It may again
1
tive or in favor of the offeree's representative.557
It
be suggested that an offer is not a physical sensation or a state
,of
of mind. Powers "coupled with an interest" survive the death
57 The German Civil Code, sec.
sec. 153,
153, provides
provides that
that the death of the offeror
57
See
shall
unless the contrary intention is apparent. See
the power, unless
end the
shall not end
2.
'
Ashley, Contracts, sec.
17, note 2.
sec. 17,
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OFFER AND ACCEPTANCE
ACCEPTANCE
OFFER
199
grantor of the power.
power. This rule might
might well apply to
to
of the grantor
acceptance is to consist of aa series
series of acts
offers where the acceptance
time and labor or expense, and part performance has
requiring time
taken place before notice of
of the death. It
It is
is on similar
similar grounds
that option contracts
contracts have been enforced,
enforced, although the acceptance
acceptance
"
58
was
subsequent
to
the
of
death
one
of
the
parties.
It
is generwas ·subsequent
ally
held
that
the
power
created
by
a
continuing
ally
guaranty is not
destroyed by the
the death of the guarantor without knowledge
58a
thereof by the creditor.
creditor.sa
ACCEPTANCE
An acceptance
acceptance is a voluntary act of the offeree whereby he
An
exercises the power conferred upon him by the offer, and thereby
creates the set of legal relations called a contract.
contract.5599 What acts
creates
are
sufficient
purpose?? We must look first
first to the
are sufficient to serve this purpose
or by
terms in which the offer was expressed, either by words or
other conduct.
conduct. The offeror is the creator
creator of the power and at the
other
time of its creation he has full control over both the fact of its
existence and its terms. The offeror has, in the beginning, full
determine the acts that are to constitute acceptance.
acceptance.
power to determine
After he has once created the power, he may lose his control
over it, and may become disabled to change
over
change or to revoke it; but
the fact that,
that, in the beginning, the offeror
offeror has full control of the
the
immediately succeeding
succeeding relation called a power, is the characterimmediately
characteristic that
that distinguishes
distinguishes contractual
contractual relations
non-contractual
istic
relations from non-contractual
58 See In re Adams & K. Vestry (1884) 27 Ch. D. 394; Ankeny v. Rich58 See In re Adams & K. Vestry (1884) 27 Ch. D. 394; Ankeny 'lJ. Richardson
187 Fed.
Fed. 550;
550; Dibbins'lJ.
Dibbins v. Dibbins
Dibbins (1896)
(i896) 22 Ch. 348; Townardson (I911)
(19II) 187
ley
v.
Bedwell
(i8o8)
14
59i; Lawes
Bennett (18o5)
ley 'lJ. Bedwell (1808) 14 Ves.
Yes. 591;
Lawes v.
'lJ. Bellnett
(1805) Ii Cox, 167;
167j
Nicholson v. Smith (1882)
(1882) 22 Ch. D. 640; Rockland-R. Lime Co. v. Leary
Nicholson'lJ.
(xg) 203 N. Y. 469.
(19II)
58a
Bradbury 'lJ.
v. Morgat~
Morgan (1862)
(1862) II H. & C. 249; Coulthart v.
v. Clemcntson
58aBradbury
Clementson
(1879) 55 Q.
Q. B.
B. D.42,
D. 42, semble;
v. Fa~fJcett
Fawcett (1873)
Ch. 866,
(1879)
semble; Harriss
Harriss 'lJ.
(1873) L. R. 8 Cit.
semble; In
Whelan [1897]
[1897] II Ir.
575. Contra,
v. Dobbins (1877)
(0877)
semble;
In re
re Whelan
Ir.575.
Contra, Jordan
Jordan 'lJ.
122 Mass.
168. In
In Knotts
v. Butler (1858)
IO Rich. Eq. (S.
C.) 143, it
122
Mass. 168.
Knotts 'lJ.
(1858) 10
(S. C.)
it
was held that the guaranty was not terminated by death of the guarantor
guarantor
with lmowledge
knowledge thereof
thereof by
by the creditor. The great weight of authority
with
is opposed
opposed to this.
19
59 Sometimes
Sometimes the closing of the
the contract
contract requires not
not merely
merely acts
acts of
of
the
the acceptor, but also other
other operative
operative facts-as where
where the offeror
offeror prescribes
that no
until he receives
scribes that
no contract
contract shall
shall exist
exist until
receives the letter of acceptance.
acceptance.
With
With the mailing of the letter the acts of the offeree may come to an
end;
of that letter
end; but
but the
the receipt
receipt of
letter is another
another necessary
necessary operative
operative fact. See
See
Lewis
v.
Browning
(188i)
130 Mass.
Lewis v. Browning (1881) 130
Mass. 173.
173.
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200
YALE LAW
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ones. After
A fter the offeror has created the power, the legal consequences
quences thereof are out of his hands, and he may be brought
brought into
numerous consequential
consequential relations
relations of which he did not dream,
and to which he might not have
have consented. These later relations
relations
are nevertheless
nevertheless called contractual.
Silence.
Silence. There is one limitation upon this power of the offeror.
It has been held that he cannot confer a power of accepting
accepting by
by
60
mere
In one aspect, this seems to be a not unreasonable
mere silence.60
unreasonable
limitation.
limitation. The opposite rule, in such cases, would enable the
acceptance
offeree to await the event, and to deny the fact of acceptance
if the contract
contract now appears
appears to be to his disadvantage, or to
assert the fact of acceptance
acceptance if appearances are to the contrary.
This argument, however, proves too much;
much; for it applies with
equal force to any positive act that might reasonably
reasonably be performed even though no offer has been made, and that has no
more probative
probative force to establish
establish assent than to establish some
other fact. Whether or not it would be so applied may be
regarded
doubtful."'1 A strong argument in favor of holding
regarded as doubtfu1.°
holding
acceptance good is that the offeror has only himself to blame
the acceptance
if the terms of his offer put him at the mercy of the offeree,
offeree, and
that he should not be permitted to escape liability when he has
induced the offeree
offeree to believe that there is a contract and to act
act
in reliance thereon. The weight of these opposing arguments
cannot
cannot be determined
determined with certainty;
certainty; but it will be a rare case
where the offeree has not done some
some overt
overt act which indicates
indicates
his intention to accept, and in such case the courts would undoubtedly hold that the acceptance
acceptance was good. This rule must not
be confused
confused with the one to the effect
effect that the offeror cannot
arbitrarily
arbitrarily cause the silence or other ordinarily
ordinarily non-expressive
non-expressive
act of the offeree to operate as an acceptance against the will
of the offeree.662- The offeror may, perhaps, confer the power
on
power on
acceptance; but
the offeree
offeree to make such
such an act operate as an acceptance;
but
he cannot unreasonably
unreasonably deprive the offeree
offeree of his preexisting
preexisting
immunity in doing those acts or of his power
power to make them
operate otherwise.
otherwise. Thus, if the offeror declares that the offeree
shall accept
accept by remaining silent or by eating
eating his breakfast, the
offeree cannot be held against his will even though he seems to
o prescott
v. Jones
(1898) 6g
69 N.
305; Felthotlse
Felthouse v.
v. Bindley
60
Prescott v.
JOlles (1898)
N. H.
H. 305;
Bifldley (1862)
(1862)
S.) 868; cf.
cf. also Kiihn, Ueber Vertragsschluss
unter
IIx C.
C. B. (N. S.)
Vertragsschluss unter
Abwesenden,
JAHRBUCHER, (N.
(N. Folge) 4, p.
P. 5 ff.
f.
IHERING's ]AHRBUCHER.
Abwesenden, IHERING'S
61
See White v. Corlies (1871) 26
26 N.
Y. 467.
467.
61 See White v. Corlies (1871)
N. Y.
62 Royal Ins. Co. v. Beatty (1888) 11g Pa. St. 6.
62 Royallt,s. Co. v. Beatt). (1888) II9 Pa. St. 6.
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OFFER AND
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ACCEPTANCE
OFFER
201
comply with
with the
the terms
terms of
of the
the offer.
offer. In
In such
such aa case,
case, the
the conduct
conduct
comply
of the
the offeree
offeree may
may with
with equal
equal reason
reason be
be regarded
regarded as
as an
an expresexpresof
of quite
quite different
different intentions
intentions and
and desires.
desires. In
In such
such case,
case, itit
sion of
sion
might be
be left
left to
to the
the jury
jury to
to determine
determine whether
whether or
or not
not the
the act
act was
was
might
3 ;; but
done with
with the
the intention
intention to
to accepte
accept68
but itit would
would be
be better
better to
to
done
jury that
that there
there isis aa contract
contract only
only if
if the
the conduct
conduct of
of
instruct the
the jury
instruct
the offeree
offeree has
has reasonably
reasonably led
led the
the offeror
offeror to
to believe
believe there
there has
has been
been
the
an acceptance.
acceptance.646~
an
Impossible Acts.
Acts. Since
Since the
the offeror
offeror is
is privileged
privileged to
to make
make no
no
Impossible
acts
at
all,
or
a
power
limited
as
he
desires,
he
may
prescribe
acts
offer
prescribe
may
he
desires,
he
as
limited
offer at all, or a power
or are
are very
very difficult.
difficult. If
If the
the prescribed
prescribed
that are
are wholly
wholly impossible
impossible or
that
at
all.
at
all. So,
So,
acts
are
totally
impossible,
there
is
in
fact
no
power
no
power
fact
acts are totally impossible, there is in
that
if
A
apparently
offers
to
contract
with
B,
but
prescribes
that
prescribes
if A apparently offers to contract with B, but
or must accept
accept by
by going
going to
to the
the moon,
moon,
must accept
accept yesterday
yesterday or
BB must
nG contract
contract can
can be
be made.
made. It
It seems
seems rather
rather fanciful
fanciful to
to say
say that
that B
no
has aa legal
legal power
power to accept
accept but
but has not the
the physical
physical capacity
capacity to
to
has
If the
the prescribed
prescribed mode
mode of
of acceptance
acceptance was that
that B
exercise it. If
exercise
should lift
lift a I,ooo
1,000 lb.
lb. weight, itit would
would not
not seem
seem so
so fanciful.
should
may not
not at present
present have
have the
the physical
physical capacity
capacity to lift the weight,
weight,
B may
The
but others have
have such capacity
capacity and B
B himself
himself may acquire
acquire it. The
but
act of going
going to the moon is also not wholly inconceivable,
inconceivable, but
but
act
of such a Cyclopean
Cyclopean undertaking
undertaking is
the only
only individual capable
capable of
the
of accepting
accepting yesterday
yesterday requires
requires the turning
Noman. The act of
Noman.
and the living
living of history over again. This seems
back of time and
seems
back
Connecticut Yankee
inconceivable, although
although Mark Twain's Connecticut
wholly inconceivable,
apparently accomplished
accomplished the feat.
apparently
If a particular mode of acceptance
acceptance has been prescribed
prescribed by the
offeree can bring about contractual relations
relations only by
offeror, the offeree
acting
exactly
in
the
prescribed.
else will be
be
Nothing
prescribed.
mode
acting
"equally as
as good."6G
good. 6 5 It makes no difference
difference how difficult
difficult or
or
"equally
expensive
prescribed
acts
be,
so
far
as
the
except
may
the
expensive
difficulty or expense may be evidence to indicate that the acts
difficulty
were not in fact prescribed.
prescribed.
C.J., once said: "It is trite law that the thought of man is not
68 Brian, C.].,
triable, for even the devil does not know what the thought of man is."
Very likely he was mistaken in each of the two statements. See Ashley,
Contracts,
51, 52.
Contracts,pp. 51,
6~
possession of goods, has
silence, in addition to a retention of possession
64 Thus, silence,
been held to be an
141.
(igoi) 178 Mass. 141.
v. Klaholt
Klaholt (lgol)
Wheeler v.
an acceptance. Wheeler
The case may well
offeror had prethe offeror
the ground that the
criticised on the
well be criticised
scribed a particular
offeree had not used
while the offeree
of acceptance, while
particular mode of
that mode and
suppose that he had.
to suppose
reason to
the offeror had no reason
and the
225.
S.) 225.
Wheat. (U. S.)
(1819) 44 Wheat.
Henshaw (1819)
v. Henshaw
65 Eliason
Eliasonv.
OG
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202
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course society is quite
quite capable
capable of creating powers in B
Of course
A, even though
whereby he can create other legal relations with A,
wholly disregards the expressed
expressed will
will of A;
A; but in such
such case
B wholly
do not call those new
new legal relations contractual.
contractual. It
It is
is here
we do
contract and nonnonthat we reach the boundary line between contract
contract.
PrescribedActs. Instead of being expressly limited, the
No Prescribed
acceptance whatever. There must
offer may prescribe no mode of acceptance
intends to create a power
be enough to indicate that the offeror intends
of acceptance, but this is quite possible in the absence of any
suggestion whatever as to the mode of acceptance. In this case
the offeree may accept in any manner that the law deems to be
reasonable under the circumstances.
acceptance may be created by the
An even larger power of acceptance
offeror. He may suggest and
and authorize an acceptance in one or
or
offeror.
more particular modes, without making them exclusive. In such
case, compliance
compliance with the suggested mode will close the contract,
however unreasonable or unusual the mode may be; but so also
however
will compliance with any other mode that the law deems to be
reasonable. In
In this case, the offeree has all the power that he
reasonable.
would have if the mode of acceptance had been exactly prescribed; and in addition thereto, all the power that he would
have if
if no
no mode
mode of acceptance had been mentioned at all.
have
The foregoing
The
foregoing rules of acceptance are applicable
applicable to all kinds
of contracts
contracts alike, unilateral and bilateral;
of
bilateral; but in their application certain distinctions are to be observed and some difficulties
tion
must be
overcome. It
It is not always easy to determine what
must
be overcome.
what
mode of
of acceptance
acceptance the offeror
mode
offeror has required
required or
or. suggested;
suggested; a
reasonable construction
other
reasonable
construction must be put upon his words or other
conduct.
If the
conduct. If
the offeror
offeror has prescribed
prescribed no mode of acceptance
acceptance
and
the offeree
suggested by the
and if
if the
offeree has
has not
not adopted
adopted some mode suggested
offeror, it
actually
offeror,
it must
must be
be determined
determined whether or not the mode actuaJIy
adopted is to be deemed reasonable.
adopted
Notice. There
of
Notice.
There is
is some conflict on the question
question of notice of
8
or
acceptance. Is the starting of such a notice by the offeree,
offeree,66
or
the receipt of such a notice by the offeror, one of the necessary
operative facts? This question is to be answered by an applicaoperative
tion of the foregoing principles.
principles. The
The offeror
offeror may prescribe
prescribe
either or both as a part of the mode of acceptance. If
If he does
66
This means the doing of an act that will, in the
of
66 This
the ordinary
ordinary course
course of
events, make the offeror
offeror aware
aware of
of the acceptance.
acceptance.
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OFFER AND
AND ACCEPTANCE
ACCEPTANCE
OFFER
2°3
so, the
the prescribed
prescribed fact
fact is
is aa sine
sine qua
qua. non,
non, whether
whether the
the proposed
proposed
so,
7
or bilateral.
bilatera1.67
If, however,
however, the
the offeror
offeror
contract is
is unilateral
unilateral or
If,
contract
of acceptance,
acceptance, not
not including
including a
prescribes some
some particular
particular mode
mode of
prescribes
notice, none
none should
should be
be required.
required. This
This is
is very
very generally
generally the
the case
case
notice,
where the
the offeror
offeror requests
requests, a return
return performance
performance but
but no
no return
return
where
is generally
generally not
not the case
case where
where he
he requests
requests aa
promise; and
and itit is
promise;
If A
A offers
offers his
his promise
promise of
of a reward
reward in
in return
return promise.
promise. If
return
of aa felon, or
or for the
the destruction
destruction of a noxious
noxious
the capture
capture of
for the
8
or for the
the act
act of
of procuring
procuring some
some one
one to buy
buy certain
certain land,
land,6s
animal, or
animal,
s°
or for
for the
the winning
winning of a race,
race,G9 or
or for the
the buying
buying and
and using
using of
of a
or
70 the
smoke ball
ball and
and catching
catching the
the influenza,
influenza,7°
requested are
are
the acts requested
smoke
clearly indicated,
indicated, and the
the contract
contract is complete
complete without
without any
any act
act
clearly
like mailing
mailing a notice, and without
without actual
actual knowledge
knowledge by
by the
the
like
If A offers his
his promise
promise of
of guaranty
guaranty in
in return
return for B's
B's
offeror. If
act of
of advancing
advancing money
money to C, the
the contract
contract is
is complete
complete when
when B
71
money.71
offers either
either
has advanced
advanced the
the money.
Where, however, A offers
performance in return for a promise
promise to be made
a promise or a performance
specify any mode of acceptance.
acceptance. In
by B, A does not usually specify
such
case,
what
is
reasonable
mode
required
by
laws? It
the laws?
by
required
reasonable
is
the
such case,
is a matter of
of course
course that B must do some
some overt
overt act
act that
that expresses
expresses
enough. The
his intention
intention to
to accept,
accept, but this, in itself, is not enough.
act must be one that B is justified
justified in believing will bring notice
notice
A. In this case,
case, such is the reasonable mode required by the
to A.
promise-for an assurance
law, because
assurance upon
because A has asked for a promise-for
He
cannot
rely
upon
it
without
knowledge,
which
he
can
rely.
knowledge,
upon
which
and it is therefore
the
custom
of
reasonable
men
to
do
acts that
acts
reasonable
therefore
been
It has been
expected to give notice to the offeror. It
may be expected
receipt
vigorously asserted that the contract is not completed until receipt
vigorously
of this notice by the offeror,72
offeror,72 but the authority against such a
07
67
68
6B
173.
13o Mass.
(i88i) 130
Lewis v.
v. Browning
Browllillg (1881)
Mass. 173.
140.
16 Ind.
Ind. 140.
Harson
Harson v. Pike (i86i)
(1861) 16
58.
63 Ind.
Ind. 58.
(1878) 63
Alvord v. Smith (1878)
256.
B. 256.
Q. B.
[1893] 11 Q.
Co. [1893]
Ball Co.
v. Carbolic
CarbolicSmoke Ball
Carlillv.
Eaton (1894)
(1894) 161 Mass. 496; S011lersall
Somersall v.
v. Bameby
Barneby (16u)
(1611)
71lBishop
Bishop v. Eaton
construction of
ero.
of
may, by construction
Cro. Jac. 287. The sending of a notice by mail may,
guaranty;
law, be made a condition precedent to a right of action on the guaranty;
but this does not make the notice a part of the process of acceptance.
Suretyship, p.
on Suret)'ship,
Cases Ol~
The
are in confusion on this. See Ames, Cases
courts are
The courts
225 ff.
Langdell, Summary
Summary of Cont.,
Cont., sec. 14; Bramwell,
Bramwell, L. J.
J. dissenting in
in
72 Langdell,
v. Eagle
McCulloch v.
Household,
Eagle
D. 216; McCulloch
(1879) 44 Ex. D.216;
Grant (1879)
Co. v. Grallt
Ins. Co.
etc. Ins.
Household,etc.
(3d. ed.)
Contracts (3d.
Ills.
(Mass.) 278; Wald's Pollock, Contracts
Co. (1822)
(1822) 1i Pick (Mass.)
Ins. Co.
37.
P.
P·37·
09
69
70 Carlill
70
7
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YALE
73
doctrine isis now
now overwhelming,
overwhelming, both
both in
in England
England and
and American.
American.73
doctrine
This
fact
shows
that
the criticisms
criticisms of
of the
the prevailing
prevailing rule
rule are
are
This fact shows that the
based upon
upon some
some a-apriori
prioritheory
theory of
of contract
contract that
that isis not
not in
in harmony
harmony
based
with human
human desires
desires and
and the
the other
other facts
facts of
of life.
life.
with
What acts
acts are
are those
those that
that may
may reasonably
reasonably be
be regarded
regarded as
as suffisuffi'iVhat
cient in
in the
the effort
effort to
to bring
bring knowledge
knowledge of
of the
the acceptance
acceptance to
to the
the
cient
offeror? If
If the
the parties
parties are
are negotiating
negotiating in
in each
each others'
others' presence,
presence,
offeror?
the act
act must
must be
be one
one that
that will
will bring
bring immediate
immediate knowledge.
knowledge. The
The
the
offeree could
could not
not accept
accept by
by mailing
mailing aa letter,
letter, because
because in
in the
the absence
absence
offeree
of an
an extended
extended time
time for
for acceptance,
acceptance, such
such aa mode
mode would
would be
be
of
unreasonable and
and unusual.
unusual. In
In choosing
choosing his
his mode
mode of
of acceptance,
acceptance,
unreasonable
the offeree
offeree must
must consider
consider the
the time
time of
of delivery,
delivery, the
the place
place of
of
the
delivery, the
the certainty
certainty of
of arrival,
arrival, and
and the
the intelligiblity
intelligiblity of
of the
the
delivery,
expression. If,
If, considering
considering these
these things,
things, the
the offeree
offeree chooses
chooses the
the
expression.
customary mode,
mode, itit isis sufficient.
sufficient. It
It may be
be sufficient
sufficient to
to mail
mail aa
customary
letter, even
even though
though the
the offer
offer was
was made
made orally,
orally, if
if several
several days
days
letter,
were allowed
74
allowed for
for acceptance.
acceptance.74
The starting
starting of
of a telegram
telegram by
were
The
the usual
usual telegraph
telegraph companies
companies would
would be
be equally
equally -effective,
-effective, and in
the
some
instances
would
be
effective
where
the
mailing
of aa letter
letter
some instances would be effective where the mailing of
would
not
be.
If
the
offer
itself
was
made
by
mail,
it
has
been
would not be. If the offer itself was
it
supposed
that
this
made
the
post
office
an
agent
of
the
offeror
supposed that this made the post
an agent
offeror
to receive
receive the
the letter
letter of
of acceptance.
acceptance. This
This theory
theory has been disapto
proved and
and seems
seems to
to have
have little
little to
to support
support it.
it. It
It is
is better to base
proved
'75
the
rule
upon
the
"usage
of
trade,
or
"the
ordinary
usages of
of
the rule upon
the "usage of trade,"75 or "the
7
mankind."
mankind."766
So much
much has
has been
been said
said about
about the
the necessity
necessity and propriety of
of
So
mailing
a
letter
of
acceptance
that
it
is
often
taken
to
be
univermailing a letter of acceptance that it is often taken to be
sally required,
required, even
even where
the offeror
offeror has
has himself
prescribed
sally
where the
himself prescribed
777
7
another
mode
of
acceptance.
another mode of acceptance.
MUTUAL ASSENT
MUTUAL
ASSENT
The
generally laid
laid down
down is
The rule
rule generally
is that
that
acceptance
must
be
expressions
of
assent.
acceptance must be expressions of assent.
the acts
acts of
of offer and
the
This
has
long
This has long been
been the
the
73 See cases cited in Wald's Pollock, Contracts (3d ed.) p. 39, note 42.
73 See cases cited in Wald's Pollock, COlltracts (3d ed.) p. 39. note 42.
See
See also
also Jap.
J ap. Civil
Civil Code,
Code, art.
art. 526.
526.
74 Hent horn v. Fraser [1892] 2 Ch. 27.
74 Henthom v. Fraser [18921 2 Ch. 27.
75 Dunlop v. Higgins (1848) I H. L. Cas. 381.
75 Dunlop v. Higgins (1848) I H. L. Cas. 381.
71 Henthorn v. Fraser,supra; see also German Civil Code, sec. 151.
76 Henthorn v. Fraser, supra; see also German Civil Code, sec. 151.
77Household etc. Ins. Co. v. Grant (1879) 4 Ex. D. 216; It re London
71 H otlsehold etc. ltzs. Co. v. Grant (1879) 4 Ex. D. 216; lIZ re London
and
Northem Bank
Balik [igoo]
[1900] iI Ch.
Ch. 220.
220. But
But Mr.
Mr. Justice
Justice Holmes
Holmes said
said in
in
al/d Northern
Lennox
v.
Murphy
(1898)
17,
Mass.
Lelmo% v. Murphy (18gB) 171 Mass. 370:
370: "There
"There is
is no
no universal
universal doctrine
doctrine
of the common law . . . . that acceptance of an offer must be comof the common law . . . . that acceptance of an offer must be communicated."
municated."
HeinOnline -- 26 Yale L.J. 204 1916-1917
OFFER AND ACCEPTANCE
ACCEPTANCE
OFFER
2°5
theory upon
upon which
which contractual
contractual obligations
obligations have
have been
been enforced.
enforced.
theory
the test
test question
question usually
usually put
put is, what
what was the intention
intention of
of the
the
the
parties? It
It must
must not
not be supposed
supposed from
from this,
this, however,
however, that
that no
no
parties?
contractual relation
relation can
can exist
exist unless
unless the
the parties
parties both foresaw
foresaw and
and
contractual
intended it.
it. If
If two
two parties
parties have
have gone
gone through
through the form of
of
intended
offering
and
accepting,
the
law
determines
the
legal
relations
that
offering and accepting, the law determines the legal relations that
follow. Frequently these come
come with
with surprise and
and shock to the
the
follow.
parties
themselves.
It
may
be
said
here,
as
in
the
law
of
torts,
It
as in the law of torts,
parties
that the
the parties
parties are
are presumed
presumed to
to intend the
the consequences
consequences of
of their
their
that
acts,
but
this
is
often
a
violent
presumption
contrary
to
fact.
To
often a
contrary to
To
acts, but
indulge
such
a
presumption
is
merely
to
hold
that
the
actual
indulge such a presumption is
to
that the actual
intention of
of the
the parties
parties is
is not
not the
the determinative
determinative fact,
fact, or even
intention
that it is wholly
wholly immaterial.
Parties are
are bound
bound by
by the
the reasonable meaning of
of what they
Parties
said
and
not
by
what
they
thought. If
If A makes an offer to B
said and not by what they thought.
have a particular meaning,
which B reasonably understands to have
and so
so accepts,
accepts, A
A is bound in accordance with B's understandunderstandand
71
ing.78 So also, if A's offer has only one reasonable meaning, B
bound in accordance
is bound
accordance therewith, even though he accepted supis
posing the
the meaning
meaning to
to be otherwise. The operative act creating
creating
posing
an obligation
obligation is the expression
expression of intention and not the thought
an
process.7799 It
It may
may be
be said
said that the purpose of the rule is to
process.
carry out
out the
the intentions
intentions of the parties in the great majority of
of
carry
cases ;80
cases
;80 but it seems better to say that its purpose is to secure the
fulfilment of
of the
the promisee's
promisee's reasonable expectations
expectations as induced
fulfilment
by
the promisor's
act."'81 . In the law of contract as in the law of
of
by the
promisor's act.
tort,
men are
are expected
to live
live up
tort, men
expected to
up to
to the standard of the reasonably
reasonably
82
prudent
If there
is aa misunderstanding
misunderstanding and neither party
there is
prudent man.
man. 82 If
Mansfield
v. Hodgdon
(i888) 147
i47 Mass:
Mass. 304.
M
allsfield 'lI.
Hodgdon (1888)
304See
(ioth ed.) p. 253; cf.
cf. Anson, Contracts
See Holland,
Holland, Jurisprudence
Jurisprudence (10th
COlltracts
(2d
Am. ed.,
p. 10.
IO. "As
"As to
(2d Am.
ed., Huffcut)
Huffcut) p.
to the
the rule
rule that
that the wills of the concontracting
it only
means that they must concur
in
only means
concur ill
tracting parties
parties must
must concur,
concur, it
legal
Langdell, Summary
Summary of
of the
legal contemplation."
cOlltemplatiol~."
Langdell,
the Law
Law of Contracts,
Contracts, sec.
I8o; see
also secs.
148, 149.
149.
180;
see also
sees. 148,
80 See Anson, cited in preceding note.
80 See Anson, cited in preceding note.
81
Holland, Juris. (ioth ed.) p. 253.
881 Holland, Juris. (10th ed.) P.253.
2 Where an acceptance was so worded that the offeror thought it con82 Where an acceptance was so worded that the offeror thought it conditional,
no
ditional, there
there was
was no
no contract
contract even
even though
though the
the acceptor
acceptor intended
intended no
condition.
condition. "If
"If it
it be
be true
true that
that respondent
respondent did not
not mean
mean to convey
convey such
such
an
an idea,
idea, but
but used
used language
language leading
leading Mr.
Mr. Hawley, in the exercise
exercise of ordiordinary
did, it
nary care,
care, to
to suppose
suppose it
it did,
it must
must bear
bear the burden
burden of its fault. He
had
had aa right
right to
to act
act upon
upon the
the meaning
meaning which
which the
the respondent's
respondent's words concon78
78
79
79
HeinOnline -- 26 Yale L.J. 205 1916-1917
206
YALE
YALE LAW
LAW JOURNAL
JOURNAL
8sS3
3
The
was negligent,
negligent, there
there isis no
no contract
contract.
The same
same is
is true
true if
if both
both
was
4
84
are equally
equally negligent.
negligent.
are
The legal
legal relations
relations consequent
consequent upon
upon offer
offer and
and acceptance
acceptance are
The
not wholly
wholly dependent,
dependent, even
even upon
upon the
the reasonable
reasonable meaning
meaning of
of the
the
not
words and
and acts
acts of
of the
the parties.
parties. The
The law
law determines
determines these
these relations
relations
words
in the
the light
light of
of subsequent
subsequent circumstances,
circumstances, these
these often
often being
being totally
totally
in
unforeseen by the
the parties.
parties. In
In such
such cases
cases it is
is sometimes
sometimes said
said that
that
unforeseen
the law
law will
will create
create that
that relation
relation which
which the
the parties
parties would
would have
have
the
intended had
had they
they foreseen.":
foreseen.8~
The fact
fact is,
is, however,
however, that
that the
the
The
intended
decision will
will depend
depend upon the
the notions
notions of
of the
the court
court as
as to
to policy,
decision
welfare, justice,
justice, right
right and
and wrong, such
such notions
notions often
often being
being ininwelfare,
articulate and
and subconscious."
subconscious.866
articulate
ARTHUR
ARTHUR L.
L. CORBIN.
CORBIN.
YALE UNIVERSrrY,
UNIVERSITY,
YALE
SCHOOL
SCHOOL OF
OF LAW.
LAW.
veyed to
to him,
him, if such,
such, reasonably, might
might be the
the meaning
meaning an
an ordinarily
ordinarily
veyed
read out of such language."
language." Jacob
Jacob Johnson
Jolmsoa Fish
Fish
careful person
person would read
careful
Co. v.
v. Hawley (1912)
(1912) ISO
578.
150 Wis. 578.
83
83 Raffles v. Wichelhaus
Wichellwus (1864)
(1864) 22 H.
H. & C. 9o6.
906.
884 Falck v. Williams
Williams [i9oo]
[1900] A. C. 176; Peerless
Peerless Glass Co.
Co. v. Pacific
Pacific Co.
secs. 119,
(18g8) 121
121 Cal. 641;
641; cf.
ct. German
German Civil
Civil Code, sees.
II9, 122.
122.
(1898)
8~ "Supposing
"Supposing a contract
contract to have
have been duly
duly formed, what
what is
is its result?
85
been created
created between
between the contracting
contracting parties, by which
which
An obligation has been
rights are conferred
conferred upon the one
one and duties are
are imposed
imposed upon
upon the
the other,
rights
partly stipulated
stipulated for in the agreement, but partly also
also implied by law,
partly
(Works III, 190)
'has thus
thus in every
every country
country
which, as Bentham
Bentham observes
observes (Works
19o) 'has
which,
supplied the shortsightedness
shortsightedness of individuals,
individuals, by doing for them what they
supplied
have done for themselves, if their imagination had anticipated
would have
Holland, Juris.
(10th ed.)
ed.) p. 278. In Leonard
Leonard
Juris. (ioth
nature."' Holland,
the march of nature.'''
(1857) 26 Conn. 172, 178, the court said: "And if we were to add
add
v. Dyer
Dyer (1857)
stipulations to the contract
contract which the parties
parties themselves did not make,
stipulations
themselves
inferred as the parties themselves
it appears to us that such only should be inferred
would have made, had they foreseen the circumstances
circumstances that rendered such
J., in Grove v. Webb (1916)
(1916)
stipulations important." See also Bankes, L. J.,
1O89.
1O82, 1089.
114
II4 L. T. 1082,
86
88 "You can always imply a condition in a contract. But why do you
imply it? It
practice of the comIt is because of some belief as to the practice
munity or of a class, or because
because of some opinion as to policy, or, in short,
because of some attitude of yours upon aa matter not capable of exact
capable of founding exact
quantitative measurement, and therefore not capable
L.
IO HARv.
HARV.L,
logical conclusions."
conclusions." Justice Holmes, The Path of the Law, 10
Rxv. 466.
REv.
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