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- Irwin Law: The Law of Contracts (First Edition)
- Part One - Formation
- Chapter 2 - Offer and Acceptance
A. Introduction
Author | John D. McCamus |
Profession | Professor of Law. Osgoode Hall Law School, York University |
Pages | 31-33 |
Page 31
The analytical framework for determining whether or not the parties have in fact reached a mutual understanding on the terms of their agreement is referred to as the law of offer and acceptance. The basic idea running through the law of offer and acceptance is that the parties will be held to have reached an agreement when they have formed a mutual intention to enter into a bargain with each other and, further, are in agreement as to the terms of that bargain. It is only then that the parties have reached a true "consensus ad idem" or "meeting of the minds," which, in theory at least, is an indispensable requirement for the formation of an agreement. In the calculus of offer and acceptance, the communications of the parties must have created an "offer" that sets out the offeror’s willingness to enter into an agreement on certain terms; this is then matched with a corresponding agreement or "acceptance" forthcoming from the other party, the offeree, which also communicates a willingness to enter into an agreement on the proffered terms. The acceptance must precisely match the terms of the offer, a proposition often referred to as "the mirror image rule." A purported acceptance that indicates different terms cannot create the required consensus. Under the orthodox analysis, the offeree must intend to accept the of-
Page 32
fer.1Thus, the fact that two parties send out identical offers, one to another, would not create the requisite consensus.2The rules of offer and acceptance, then, establish the analytical mechanism whereby the common law attempts to identify fact situations in which the parties have reached agreement and distinguish them from situations in which parties have merely negotiated unsuccessfully toward that end.
Application of the offer and acceptance analysis requires an examination of the communications between the negotiating parties with a view to isolating communications that constitute an offer in the requisite sense and a corresponding acceptance. The detailed rules articulate the basic tests for isolating offers from other forms of communication and for identifying genuine acceptances. Further, they prescribe such requirements as exist for the communication of the initial offer and the acceptance. They also determine whether and when offers may be revoked. Each of these topics will be considered below. Although there are many factual circumstances in which the application of these rules is quite...
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