YALEYALE JOURNAL

Vol. XXVIXXVI JANUARY, 1917 No.No.3 3

OFFER AND ACCEPTANCE, AND SOME OF THE RESULTING LEGAL RELATIONS InIn the study and the practice of the law,law, our constant problem is:is: what legallegal relations are the result of facts that occur; or, starting from the other direction with a given set of legal rela-rela­ tions (such(such as a , or a debt, or thethe ownership of land)land) our problem is: what facts will operate to cause such a result?result? One may take either starting point; and indeed-indeed for the best results, it is necessary to take both, alternately working forward and back, correcting and amplifying our necessarily tentative conclusions. In the present article, thethe starting point will be the contractual relations themselves, leading back to a consider-consider­ ation of some of the facts and intermediate relations that various forms? The term contract has been used without much discrimination to refer to three different things: (i)(I) the series of operative acts of the parties expressing their assent and resulting inin new legal relations; (2) the physical document executed by the parties as an operative fact in itself and as the lasting of their having performed thethe necessary operative acts; (3) the relations resulting from the operative acts, consisting of a right or right inin personainpersonam and the corresponding duties, accompanied by certain powers, privileges and immunities.immunities.'1 Clearness of

1I For a masterly analysisanalysis andand classification ofof jural relations, seesee anan article onon Some Fundamental Legal Conceptions as Applied inin Judicial Reasoning, in 2323 YALE LAWLAw JOURNAL, 16, by Professor 'V.W. N.N. Hohfeld of the Yale School of Law. [i6] 13

HeinOnline -- 26 Yale L.J. 169 1916-1917 YALE LAW JOURNAL thought requires that whenever the term is used, one particular meaning should be consciously adopted and clearly expressed. Very likely it would be most convenient generally to define contract in sense (3), as the legal relations between persons arising from a voluntary expression of intention, and including at least one primary right in personam, actual or potential, with its corresponding duty. Unless othenviseotherwise indicated, the term its 2 contract will be used herein with this meaning.2 In determining whether or not a contract exists in any given case, one of our problems is historical in character. What were the facts? What were the acts of the parties and the circum-circum­ stances that'that surrounded them? When these have been ascer­ascer- tained the next step is analytical. Immaterial facts must be elim­elim- inated, and the rest must be classified as either evidential or operative. The,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 reference to the Jawlaw of contract. This law is a part of the general legal system under which we live, enforced by the societal organization of 'whichwhich we are part. . What the rules of this society are, can be determined only by induction from the judg-judg­ ments and and pronouncements of the past. Under the existing legal system no legal relation is deemed contractual in the absence of certain voluntary acts on ·the-the part of two con­con- tracting parties. What acts are those which will cause society to come forward with its strong arm? They may well be described as operative or causative, for they are necessary antecedents to the creation of those legal relations and societal

2 Compare the following definitions. "The most popular description of a contract that can be given is also thethe most exact one; namely, that it isis a promise or set of promises which the lawlaw will enforce. The specific mark of a contract is the creation of a right, not to a thing, but to another man's conduct in the future." "Every agreement and promise enforceable by law is a contract." \Vald'sWald's Pollock, COl/tractsContracts (3d ed.) pp. 1,2.1, 2. A contract is "an agreement enforcible at law,law, made between two or more persons, by which rights are acquired by one or more to acts or forbearances on the part of the other or others." Anson, COlltractsContracts (2d Am. ed., Huffcut) p. II.ii. "The act alone is the contract, the resulting contractual relation is quite a different thing." Holland, JurisprudenceJurisprudel/ce (loth(ioth ed.) p. 251. See also Bentham's classification, Works, III, 191.i91.

HeinOnline -- 26 Yale L.J. 170 1916-1917 guaranty ofof compulsion calledcalled contract. The analysis of thesethese acts into offer and acceptance, customarily mademade by writers on contract law, is a convenient one. An offer is an act on the part ofof one person wherebywhereby he gives toto another the legal power of creatingc.reating thethe obligation called contract.contract; AnAn acceptance is thethe exercise of the power conferred by thethe offer, by the performance of some other act or acts. Both offer and acceptance must be acts expressing assent. The act constituting an offer .andand the act constituting an acceptance may each consist inin a promise. A promise is an expression of intention that the promisor will conduct himself in a specified way in the future, with an invitationinvitation to the promisee to rely thereon. If only one of thethe acts has this character, the contract is unilateral. If both acts have thisthis character, the contract is bilateral. If neither of the acts has thisthis character, the new set of legal relations,relations, if any exist, is not called obligation. In such case there is no contract in sense (3) adopted above, although there may be one in either of the other senses. Each of these three cases will be discussed below. In none of these cases will the expected legal relations be created unless the acts of the parties comply with the rules relating to mutual assent, , form, of parties, and of object. Only certain rules relating to mutual assent will be considered here. BARTER A mutual, present exchange of laQdslands or chattels creates no contractual duty. If A has apples to sell and B has money, A may offer the apples to B for the money. ·B-B may accept by delivering to A the possession of the money. Such a transaction is a barter. The character of the commoditiescom~odities exchanged is not material. Such a transaction creates new physical relations, and in an organized society it creates new legal relations. These new relations arise by the voluntary action and consent of the two parties, but there is no special right in personam. There is a contract in sense (I)(i) described above, and a documentary bill of sale would be a contract in sense (2), but there is no contract inin sense (3). After such a transaction the apples "belong" to B and the money to A; this means that organized societysociety has created numerous legal relations between each party and every other member of society. A and B are saidsaid to have rights in rem, a term thatthat is useful even thoughthough likelylikely to mislead some into

HeinOnline -- 26 Yale L.J. 171 1916-1917 YALE LAW JOURNAL thinking that such a right is a physical relation to the res. The legallegal relations created are not special relations between A and B; they involve all persons alike, and exist in total independence of their voluntary action or consent. If after the transaction A should forcibly deprive B of the apples sold to him, he is com-com­ mitting no different wrong from that committed by X if he should do the same, and he is subject to no different penalties. After such a transaction the legal relations between A and B, arising by their consent, are precisely like the legal relations existing between X and B, although X has consented to nothing. Such a transaction is often called an executed contract, but it is better described as a barter or an exchange of goods.

GIFT If A has lands or chattels and executes a gift to B, which B accepts, there are acts of offer and acceptance and there is mutual assent, yet no contractual obligation is created. As in the case of a barter, the only rights involved are property rights or rights in rem. The only duties created are those general duties, binding upon non-participating persons as well as upon A. No special right in personam is created. A's rights in remrein and B's former duties are extinguished, and in lieu thereof similar rights are created in B and similar duties devolve upon A. The same may be said of their respective privileges, powers, immunities, and their correlatives. Thus, there are new legal relations, arising from voluntary acts of offer and acceptance. and such acts would fulfil the first definition of a contract given above. A paper " of gift" would satisfy the second definition. The resulting legal relations, however, should not be described as contractual, according to definition (3). All other persons, and not merely A and B, are parties to these new relations.

CONTRACT If A has apples (or land) to sell, and B has no money, a barter of apples for money is not possible; but A may be willing to deliver his apples to B in return for B's promise to pay money in·in-the future. If B agrees to this, 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 creates numerous relations between B and all other persons; as to the apples, he has rights in rem against such other persons. B's rights are property rights and not contract

HeinOnline -- 26 Yale L.J. 172 1916-1917 OPFEROFFER AND ACCEPTANCE 173 rights.rights. But thethe position of AA is veryvery differentdifferent from thatthat of barter. A has no money, andand no rights in rem,ren, good as against thirdthird personspersons who are not not consenting;consenting; butbut a promise hashas been mademade toto A by B, thethe fulfilmentfulfilment ofof which isis commanded by organizedorganized society. IfIf B failsfails toto keep hishis promise, societysociety will atat A's requestrequest exerciseexercise compulsioncompulsion againstagainst B, but will exerciseexercise compulsion against no other person. Special legallegal relationsrelations exist betw'eenbetween A and B, A having aa claim against B ·that-that he has 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,3discussed,3 constitute the obligation; and sincesince they arise from expressionsexpressions of mutual consent, theythey areare contract. A's special right against B is called a right inin personam.

UNILATERAL AND BILATERAL If thethe acts of A and B areare such as toto createcreate a rightright or rightsrights in personam, actual or potential, in favor of A and against B, but no suchsuch right in favorfavor of B against A, the contract isis called unilateral. If they create mutual rights inin personam with their corresponding duties, the contract is bilateral. It has sometimes been said that a contract must be binding on both parties or that it is binding on neither, thatthat mutuality of obligation is required; but this is a loose and inaccurate statement. It has no application 4 whatever inin the case of unilateral contracts.4 (I) If A makes a promise in writing to pay B $100$Ioo and signs, seals, and delivers the document, a unilateral obligation is created. It creates a duty resting on A and a right possessed by B. (2) If A accepts a bill of exchange drawn upon him by B in

3 They are, however, of vital importance, both practically and logically. See Hohfeld, loc.lac. cit. note I, supra. 4 very frequently use the term "unilateral" to refer to a promise that is without consideration, especially in those cases where mutual promises have been given, but one of them is illusory: as where A offers a promise to carryallcarry all the milk that B may care to ship, at fixed rates, and B accepts the offer and promises to pay those rates for all milk shipped by him with A. It is not unlikely that this is the prevailing usage, but it is illogical and should be abandoned. Both A and B have made promises, but neither promise has resulted in either a right or a duty. There is no obligation, unilateral or otherwise. A has made an offer and perhaps B still has a . This one new rela-rela­ tion might be described as unilateral; but the same may be said of any offer, and it is not customary to do so. See Morrow v. So. Express Co. (1897) 101ioI Ga. 8io;810; Rehm-Zeiher Co. v. Walker (1913) I56156 Ky. 6; AntericanAlIlericalt Refrig.Retrig. Co. v. Chilton (1900)(19oo) 94 Ill. App. 6.

HeinOnline -- 26 Yale L.J. 173 1916-1917 174 YALEYALE LAWLAW JOURNALJOURNAL favorfavor ofof C,C, aa rightright springssprings upup inin CC andand aa dutyduty restsrests onon A.A. ThisThis obligationobligation betweenbetween AA andand CC isis unilateral.unilateral. (3)(3) IfIf AA givesgives toto BB hishis IIOU 0 U inin returnreturn forfor moneymoney loanedloaned byby B,B, therethere isis aa similarsimilar unilateralunilateral contract.contract. (4)(4) IfIf BB offersoffers toto AA a a conveyanceconveyance ofof propertyproperty inin landland oror chattelschattels forfor aa promise,promise, andand thethe offeroffer isis accepted,accepted, thethe contractcontract isis unilateral.unilateral. ForFor example,example.. BB sayssays toto A,A, "This"This blackblack horsehorse isis yoursyours asas hehe standsstands inin returnreturn forfor youryour promisepromise toto paypay meme $Ioo$100 inin 3o30 days."days." AA replies,replies, "I accept."accept." ThisThis isis anan executedexecuted salesale onon creditcredit withoutwithout warranty.warranty. B'sB's offeroffer confersconfers upon AA thethe powerpower toto makemake thethe horse his ownown byby making thethe requestedrequested promise.promise. NoNo duty, special toto himself, restsrests uponupon thethe offeror,offeror, andand thethe offeree getsgets nono rightright inin personam.personam. TheThe offerorofferor gainsgains aa rightright inin personampersonam and thethe offeree getsgets instantlyinstantly certaincertain rightright inin rem.rem. (5)(5) A offers aa promisepromise of aa rewardreward of $ioo$roo toto anyone who will arrest X.X. B, with knowledgeknowledge ofof thisthis offeroffer andand withwith intentintent toto accept it, arrests X.X. A unilateral obligation at once arises.arises.6 (6)(6) A writes toto B, "Ship"Ship me 2 cars XX flour via B. & 0., at once, priceprice $io$10 per bbl.bbl. COD."C.O.D." BB shipsships at onceonce as.as­ requested.17 ((7)«7) A sends his brother to B with the following letterletter of credit,credit.. "Let Harry have $ioo$100 and I will repaymentrepayment 8 in 30 days." B advances $ioo$100 as requested.requested.s (8) A promis'espromises B toto pay him a salary at the rate of $Io,ooo$10,000 a year for B's services as superintendent. B may recover at thethe specified rate for such service as he thereafter renders, but thethe hiring is a hiring at will.will.'9 - 65 Mactier v. Frith (1830)(183o) 6 Wend. (N. Y.) 103. Langdelt,Langdell, Summar)',Sunmary, sec. 14, suggests that in this case no promise was necessary, because a debt would arise on Mactier's acceptance of thethe brandy; but the writer believes thatthat such an acceptance necessarily involves a promise to pay, in fact, and that without such a promise the offeror did not intend title to pass. 60 See Williams v. West Chi. St. Ry. (1901)(19Ol) 191 Ill.Ill. 610;61o; Williams v. Carwardine (1833) 4 B. & Ad. 621; Biggers v. Owen (1887) 79 Ga. 658; S/me'jlShucy v. U. S. (1875)(875) 92 U. S. 73. • 7 See WoodWood v. Benson (1831)(1831) 2 Cr. & J. 44; Challenge Wil~dWind Mill Co. v. Kerr (18g2)(1892) 93 Mich. 328;328; Wheat v. Cross (1869) 31 Md. 99. 88Lascelles v. Clark (1910)(igio) 2042o4 Mass. 362; Lennox v. Murphy (18g8)(1898) 171171 Mass.Mass. 370; Eddowes v. Niell (1793)(1793) 44 Dalt.Dall. (U.(U. S.)S.) 133; Bishop v. Eaton (18g4)(1894) 161 Mass. 496; Offord v.v. Davies (1862) 1212 C.C. B. B. (N.(N. S.) 748. 9 9 Martin v.v. N. Y.Y. Life Ins.Ins. Co. (18g5)(1895) 148148 N. Y. 117; Harper v. Hassard (1873)(1873) 113113 Mass. 187;187; StensgaardStensgaardv. v. SmithSmith (1890)(i8go) 4343 Minn. II;ii; OrrOrr v.v. WardWard (1874)(1874) 7373 Ill.Ill. 318.

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It has been said that unilateral contracts are made either by an offer of a promise for an act or by an offer of an act for a promise.10 This means, although the descriptive words are not exact, that the single duty may rest on the offeror, the right beingoeing in the offeree, or vice versa. The words are inexact, because the making of a promise is itself an act. All offers are acts and all acceptances are acts, whether the resulting legallegal relations are property as in the case of a barter, or constitute a contractual obligation, either unilateral or bilateral. In example (I)(i) above, the offeror makes a proI!1isepromise and undertakes a duty, but he requests no act whatever as an equivalent. The only act on the part of the offeree is such an act of acceptance of the physical document as may be necessary to constitute a legally effective delivery by the offeror. The duty is on the offeror. In example (2), C makes the offer when he presents the bill to A for acceptance. He thereby confers upon A the legal power of 'binding himself alone to pay a sum of money. In presenting the bill C does an act, but he is not offering this act as the legal equivalent and agreed return for A's promise. There is no offer of an act for a promise, but the act of the offeror was necessary before the offeree could undertake the duty. Example (3) is a case where it does hot clearly appear which one made the offer. If A offered his IIOU 0 U to be accepted by a transfer of money, it was an offer of a promise for an act. If B offered a transfer of the money in return for the IOU,I 0 U, the case is justjust like example (4), except that there is paper evidence of A's promise. Example (4) is a case where the duty is assumed by the offeree. B's act has been 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 must necessarily do; but he does not offer the act, he does the act. This act is completely performed even before A hears of it and perhaps long before A makes his promise. This act, regarded as in itself the consideration for A's promise, would be past consideration. The effect of B's act in making the offer is to confer upon A a power to create new legal relations. It produces this effect instantly and in so doing is wholly exhausted. The exercise of this power requires no further act upon B's part; it requires merely acceptance by A. The legal effect of this acceptance is the instant extinction

10 Contracts 22. 10 Anson, COl/tracts (2d ed., Huffcut) sec. 22.

HeinOnline -- 26 Yale L.J. 175 1916-1917 YALE LAW JOURNAL of B's rights in rem and other property relations in respect of the horse and the creation in A of similar rights and relations. The consideration for A's promise is this substitution of rights, and it is this substitution that is offered in return for the one right in personam to be created by A's promise. Examples (5), (6) and (7) are all cases where a promise is offered for an act. That is, A by promissory words gives to B the power of creating in himself a right in personam as against A by doing an act or acts which A desires to be done. In (5) this act is one affecting the physical and legal relations of X, a third party. In (6) B's act effects a substitution of property, A becoming owner of the flour. It also effects a physical change in the location of the goods. In (7) B's act confers property upon Harry, and extinguishes such property in B. It gives B in return a right in personam against A, enforcible after 30 days. A bilateral contract is made in exactly the same way as is a unilateral contract or a barter. The offeror does an act con-con­ ferring a power upon the offeree, and the 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 of bilateral contracts: (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 accept." (IO)(10) A writes to B, "I promise to convey Blackacre to you on June 1stIst in return for your promise to pay me $I,ooo$1,000 at that time. You may accept by cable, using the one word 'Blackacre'." B sends the cable despatch "Blackacre," as requested. In case (9) the acts of offer and acceptance are oral promissory words. In case (10)(io) the offer is the act of writing and the further acts whereby this writing is brought to the offeree. The acceptance consists of acts by B, whereby he directs the cable company to transmit the word "Blackacre." These acts by B would not customarily amount to a promise to pay $1,000,$i,ooo, but in this case they do become such a promise because A will so interpret them and B knows it. In the same way any other act, in itself meaningless, may be specified and may thereby become a return promise. It is not always an easy matter to determine whether a contract is in fact unilateral or bilateral. Frequently, this determination-determination will have very important results, especially where the offeror has

HeinOnline -- 26 Yale L.J. 176 1916-1917 OFFER ANDAND ACCEPTANCEACCEPTANCE attemptedattempted toto revokerevoke hishis offeroffer asas explainedexplained elsewhere.elsewhere. TheThe formform of wordswords usedused by thethe partiesparties isis notnot atat allall conclusive,conclusive, whenwhen examinedexamined outout of theirtheir setting andand withwith thethe aid of nothingnothing butbut a dictionary. TheThe meaning of words,words, as usedused by thethe partiesparties toto aa contract, cannotcannot bebe determined withwith mathematical certainty;certainty; andand thethe judgejudge whowho isis mostmost certaincertain toto dodo injusticeinjustice isis thethe pedantpedant whowho holds contractorscontractors toto meticulousmeticulous accuracyaccuracy inin thethe usageusage ofof wordswords and inin the construction ofof sentences."sentences.l1 It cancan hardly bebe saidsaid thatthat courts are often pedanticpedantic inin thisthis matter, thoughthough itit isis possiblepossible that professors of lawlaw may be.be. TheThe distinction between unilateral and bilateral isis not even yet very thoroughlythoroughly grasped byby the multitude of , a fact which leads -them-them toto repeatrepeat again andand againagain thethe erroneous statement that one cannot be boundbound unless thethe other is bound. TheThe ,judges, therefore,therefore, are not inin general tootoo likely toto holdhold thatthat a proposed 1 2 contract is unilateral whenwhen thethe parties meant it toto bebe bilateral.bilateral.12

11""The ""The logic of thethe portionportion of the opinion ...... aboveabove quoted, from thethe standpoint of the grammarian and verbal 'precision,precision, isis unassail-unassail­ able;able-; but it may be questioned whether so literal, narrow, and technicaltechnical a construction ought to be put upon such an ordinary business communi-communi­ cation." BaumanBau11lal~ v. McManusMcMallus (1907) 75 Kan. io6.106. "In interpreting a declaration of intention, the realreal intention is toto be looked for and itit isis not to be tiedtied to the literal sense of the expre~sion."expression." German Civil Code, sec. 133. 12 "Whenever circumstances arise in the ordinary business of life in which if two persons were ordinarily honest and,and careful the one of them would make a promise toto thethe other, it may properly be inferredinferred that both of them understood that such a promise was given and accepted." Ex parte Ford (1885)(885) 16 Q. B. D. 305, 307. In Mapes v. Sidney (x623)(1623) Cro. Jac. 683, the defendant promised to pay the debt of J. S. to the plaintiff in consideration that the plaintiff would forbear to sue J. S. Plaintiff alleged that he forbore per 11Iagnu11Imagnum tempus. Winch and Hutton, J.J., thought this bilateral, the plaintiff having promised to forbear forever. Hobart, c.J.,C.J., thought it unilateral, but that the plaintiff had forborne sufficiently for acceptance; he said, "without express words he is not chargeable by promise." Similar contracts were held toto be bilateral inin ThemeTherne v. Fuller (1616) Cro. Jac. 396; CowlinCowli,~ v. Cook (about 1626)1626) Latch, 151. That Mr. Holmes is not unwilling toto discover the implication of a promise on evidence that seems not any too strong, seesee WheelerWheeler v. Klaholt (1901)(igoi) 178178 Mass. 141; Martin v.v. Meles (1901)(igoi) 179 Mass. 114.114. Where a promise isis givengiven by thethe offeror,offeror, with a proviso or condition attached, thethe fulfilmentfulfilment ofof which requires action by thethe offeree,offeree, not only is itit frequently inferredinferred that such action is the intended consideration forfor the promise but itit is also inferredinferred thatthat the offeree has promised thatthat ~ethe

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Suppose A writes to B, "I will pay you $5,000$5,ooo for Blackacre," and B replies, "I accept your offer." This seems to be bilateral, and it is too late for A to revoke. A clearly makes a promise to pay money; and, according to the ordinary understanding of m~nkind,mankind, he requests B to make a return promise to convey the land. But if A has asked an actual conveyance of Blackacre as the equivalent of his promise, there is no contract at all, and A may revoke. In example (8) above, some courts have found in the words of the parties a promise by A to pay to B a year's salary and a return promise by B to serve for a year. In such case the hiring is not at will, but for a year; and this despite the fact that there 3 are no express promissory words of that sortPsort.1 In example (6) above, it has often been held that the offeree may accept by mailing a letter containing a promise to supply the goods-an "acceptance of the order," and that a after such acceptance is too late, even though the goods are not yet shipped.'shipped.144 It must not be assumed too readily that an order for goods is an offer of a promise in return for title to the goods to be effected by the act of shipment or otherwise. The offeror frequently wishes a return promise, as the offeree under­under- stands. The language used may be elliptical, and understood to be so.

EXPRESS, IMPLIED, AND TACIT CONTRACTS A brief definition of these terms will suffice here. .-\n An express contract is said -to exist when the acts of the parties declaring their will and intention are spoken or written words. A tacit contract is any other kind, the acts of the parties being sufficient

action shall take place. DtmtonDunton v.'lJ. DuntonDUllton (1892)(18g2) 18 Vict.Viet. L. R. II4;114; Jamieson'lJ.Jamieson v. Renwick (1891) 17 Vict.Viet. L. R. 124; LewisLewis'lJ. v. Atlas Mut. Life Ins.IllS. Co. (1876) 61 Mo. 534; cf. BinningtonBillnillgton 'lJ.v. Wallis (1821) 4 B. & Ald. 65o.650. On the other hand, where the defendant had made a written promise to remain with the plaintiff for two years for the purpose of learning to be a dressmaker, the refused to draw the inference of a promise by the defendant to serve or of a promise by the plaintiff to employ. LeesLecs'lJ. v. Whitcomb (1828) 5 Bing. 34.34, 2 M. & P. 86. 1313 Beach v. MullinMullil~ (1870) 34 N. J. L. 343, 345; Grossman v.'lJ. SchenkerSchenllCr (1912) 2o6206 N. Y. 466. See Mechem, AgencyAgcllc'j) (2d ed.) sec. 603.6o3. 14A1Ilcricall24American Pub. Co. 'lJ.v. Walker (igol)(1901) 87 Mo. App. 503; Gordon Malt-Malt­ ingillg Co. v.'lJ. Bartels Brewing Co. (1912) 20626 N. Y. 541; Sal~fordSanford 'lJ.v. BrownBro~tm Bros. Co. (1913) 2082o8 N:NM.Y. 90;go; BaumanBauman'lJ. v. McManus (1907)(19o7) 75 Kan. 106.io6.

HeinOnline -- 26 Yale L.J. 178 1916-1917 O'FFEROFFER ANDAND ACCEPTANCEACCEPTANCE 179 toto expressexpress theirtheir intentionintention butbut notnot consistingconsisting ofof words,words, eithereither spokenspoken oror written.written. ItIt cancan easilyeasily bebe seenseen thatthat a atacittacit contractcontract isis also,also, inin aa broaderbroader sense,sense, anan expressexpress one.one. WordsWords areare oftenoften lamelame andand haltinghalting thingsthings inin performingperforming theirtheir functionfunction ofof expressingexpressing thought.thought. ItIt isis oftenoften truetrue inin factfact thatthat actionsactions speakspeak louderlouder thanthan words.words. TheThe termterm impliedimplied contractcontract isis generallygenerally usedused toto meanmean exactlyexactly thethe samesame asas tacittacit contract.contract. TheThe intentionintention ofof thethe partiesparties isis "implied""implied" orQr inferredinferred fromfrom theirtheir actionsactions otherother thanthan words.words. ForFor somesome centuries,centuries, however,however, itit hashas beenbeen customarycustomary toto describedescribe asas aa "contract"con~ract impliedimplied inin law"law" certaincertain otherother legallegal relations,relations, inin casescases wherewhere neitherneither thethe wordswords ofof thethe partiesparties nornor theirtheir otherother actsacts justifyjustify anan inferenceinference thatthat theythey intendedintended toto createcreate suchsuch relations.relations. ThisThis usageusage seemsseems toto havehave beenbeen duedue toto twotwo reasons:reasons: inin thethe earlierearlier casescases thethe courtscourts desireddesired toto makemake thethe formform ofof actionaction calledcalled assumpsitassttmpS'i..t availableavailable forfor thethe enforcementenforcement ofof certaincertain dutiesduties notnot intentionallyintentionally assumed;assumed; andand inin somesome ofof thethe laterlater casescases thethe courtscourts desireddesired toto avoidavoid thethe appearanceappearance ofof creatingcreating legallegal rightsrights andand dutiesduties wherewhere thethe partiesparties hadhad notnot soso agreed.agreed. ThusThus thethe termterm impliedimplied contractcontract becamebecame aa slipperyslippery oneone uponupon whichwhich judicialjudicial reasoningreasoning hashas notnot infrequentlyinfrequently slippedslipped intointo error.error. TheThe legallegal relationsrelations commonlycommonly described asas contractscontracts impliedimplied inin lawlaw are nownow comingcoming toto bebe calledcalled quasiquasi contracts. ItIt isis not necessary herehere toto describe whatwhat thesethese are;are; it isis enoughenough toto observeobserve thatthat theythey areare notnot contracts inin fact,fact, either expressexpress or tacit.

VOID, VOIDABLE, AND UNENFORCIBLEUNENFORCIBLE CONTRACTS

The term is an apparent self-contradiction. This depends, however, upon the sense in which we are using the term contract. In this case it appears to be used to refer to the acts of offer and acceptance by the parties or to the document evidencing suchsuch acts. In thethe case of aa void contract, thethe parties perform acts that wouldwould usually operate to createcreate new contractual relations, but havefiave no suchsuch operation inin thethe particular case.case. Rights andand otherother relationsrelations willwill exist after suchsuch aa transaction, but theythey will not be contract rightsrights andand relations.relations. AA contractcontract rightright isis aa primary rightright inin personam arising fromfrom expressionsexpressions ofof consent.consent. InIn thethe casecase ofof aa voidvoid contract,contract, therethere areare expressionsexpressions ofof agreement,agreement, butbut theythey dodo notnot havehave thethe usualusual legallegal effect.effect. IfIf thesethese actsacts areare meremere words,words, theythey areare notnot operativeoperative factsfacts atat all.all. StandingStanding alone,alone, theythey havehave nono legallegal effect.effect. TheyThey may,may, however,however, bebe accompaniedaccompanied byby

HeinOnline -- 26 Yale L.J. 179 1916-1917 ISo YALEYALE LAWLAW JOURNALJOURNAL otherother acts,acts, e.e. g.,g., aa deliverydelivery ofof goods,goods, thatthat havehave legallegal operation.operation. TheThe legallegal relationsrelations consequentconsequent uponupon thesethese accompanyingaccompanying actsacts areare nevernever thethe onesones thatthat thethe partiesparties hadhad inin contemplation.contemplation. TheThe offeroffer createscreates nono legallegal powerpower inin thethe offeree;offeree; andand ifif hishis actact ofof acceptanceacceptance createscreates newnew legallegal relations,relations, thatthat isis duedue toto legallegal powerspowers thatthat hehe possessedpossessed eveneven beforebefore thethe offeroffer waswas made.made. InIn thethe casecase ofof aa voidablevoidable contract,contract, thethe actsacts ofof thethe parties,parties, eveneven whenwhen theythey areare meremere words,words, operateoperate toto createcreate newnew legallegal relations,relations, andand thesethese areare inin aa measuremeasure thethe onesones contemplatedcontemplated byby thethe parties.parties. TheyThey areare usuallyusually describeddescribed asas rightsrights andand duties,duties, privilegesprivileges andand powers,powers, etc.,etc., justjust asas inin thethe casecase ofof aa validvalid contractcontract ;15;15 butbut oneone ofof thethe partiesparties has thethe additionaladditional powerpower andand privilegeprivilege ofof extinguish­extinguish- inging them.them. TheThe exerciseexercise ofof thisthis powerpower isis describeddescribed asas thethe disaf­disaf- firmancefirmance or avoidanceavoidance ofof thethe contract.contract. Another wayway ofof describ­describ- inging aa voidable contractcontract isis toto saysay thatthat thethe contemplatedcontemplated contractualcontractual relations dodo notnot yetyet exist,exist, butbut thatthat one ofof thethe partiesparties has an irrevocableirrevocable powerpower toto createcreate them. HisHis subsequentsubsequent act isis thenthen called ratification.ratification. The termterm unenforcible contractcontract includesincludes bothboth void contractscontracts and voidable contracts. It isis customarily usedused so asas to describe certain other legallegal relations also.also. WhenWhen a contractcontract has become unenforcible byby virtue of thethe of limitations, thethe obligor or debtor has a power to create aa new right in the other party as against himself (and(and to destroy his own existing privilege) by a mere expression of his will, without any act of assent by the other and without a new consideration.consideration. He cannot, however, as in a voidable contract, destroy the existing rights of the other party or create new rights in himself as against that other. When a contract is unenforcible by reason of the , either party has the legal power to create rights as against himself (or to terminate his existing power of destroying the other's rights) by signing a written memorandum, but he has no such power to create rights in his own favor. In these cases a legallegal relation exists that is different from that existing in the case of a void 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 timetime of the pleading (as if an infantinfant seals and delivers aa deed, or a man of fullfull age by duress) inin thesethese and thethe like cases, thethe obligor cannot plead nonn01~ est factum,factum, for itit is his deed at thethe time of thethe action brought." Whelpdale's Case (I6o5)(1605) 55 Coke,Coke, ihg119 a; Wald'sWald's Pol-Pol­ lock,lock, Contracts (3d(3d ed.)ed.) p. 7; Windscheid, Pandekten,Pandekten, I,I, secs.sees. 7o,70, 82.

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ItIt appearsappears thatthat thisthis differencedifference isis notnot asas oneone authorauthor says,says, "mainly"mainly aa differencedifference betweenbetween substancesubstance andand procedure."'procedure."161 TheThe differencedifference betweenbetween aa powerpower toto createcreate aa rightright againstagainst anotheranother personperson andand aa powerpower toto createcreate aa rightright againstagainst onlyonly oneselfoneself isis notnot merelymerely procedural.procedural. BothBoth voidablevoidable andand unenforcibleunenforcible contractscontracts areare likelike validvalid con-con­ tractstracts inin this:this: therethere havehave beenbeen actsacts expressingexpressing agreement,agreement, andand theythey areare legallylegally operativeoperative factsfacts creatingcreating newnew legallegal relations.relations. TheThe resultingresulting legallegal relationsrelations areare differentdifferent fromfrom thosethose existingexisting inin thethe casecase ofof aa validvalid contract;contract; butbut thesethese relationsrelations areare distinctdistinct inin character,character, areare ofof considerableconsiderable practicalpractical importance,importance, andand deservedeserve eveneven betterbetter namesnames thanthan theythey havehave received.received. ThereThere areare nextnext toto bebe consideredconsidered thethe actsacts ofof offeroffer andand accept-accept­ anceance byby meansmeans ofof whichwhich thethe foregoingforegoing legallegal relationsrelations areare finallyfinally established,established, andand alsoalso somesome ofof thethe intermediateintermediate relationsrelations thatthat arisearise priorprior toto thethe closingclosing ofof thethe contract.contract.

THETHE OFFEROFFER Definition.Definition. AnAn offeroffer isis defined aboveabove as anan actact wherebywhereby oneone person confersconfers uponupon anotheranother thethe power toto create contractualcontractual relationsrelations betweenbetween them. It has notnot been customarycustomary toto describedescribe as aa "power" thethe new legallegal relationrelation consequent uponupon anan offer;"offer ;17 but this termterm seems toto be thethe mostmost accurate descriptiondescription of thatthat relation.relation. It is similar toto the relation existing inin thethe case of agency.""agency.1S The principal, by an act called "appointment," creates in thethe agent the power of creating (in conjunction with a third person) new legal relations between thethe principal and a third person. After the one voluntary act of the principal called "appointment," nothing further remains toto be done by him; thereafter it is the voluntary act of the agent that is opera­opera- tive toto create new relations. So in the case of an offer: the act of the offeror operates to create in the offeree a power, and having so operated it isis exhausted; thereafter the voluntary act of

ill18 Anson, COI~tractsContracts (2d(2d Am. ed., Huffcut) sec. 19.i9. 1717 The first,first, and thethe best,best, presentationpresentation ofof this concept thatthat has been seenseen by thethe writer isis inin thethe articlearticle onon Some Fundamental LegalLegal ConceptionsConceptions asas Applied inin JudicialJudicial Reasoning,Reasoning, inin 23 YALE LAW JOURNAL,JouRNAL, 16,i6, 49, by Professor W. N.N. Hohfeld, toto whom thethe writerwriter acknowledges greatgreat in­in- debtedness.debtedness. InIn JordanJordanv. Dobbi,~sDobbins (1877)(1877) 122122 Mass.Mass. 168,I68, thethe courtcourt speaksspeaks ofof aa continuingcontinuing guarantyguaranty asas "a"a powerpower oror authorityauthority which hehe might atat anyany timetime revoke."revoke." 1S18 SeeSee Hohfeld,Hohfeld, locoloc. cit.cit. p.p. 46.46. 14

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the offeree alone will operate to create the new relations called a contract. The Operative Act. \VhatWhat kind of act creates a power of acceptance and is therefore an offer? It must be an expression of will or intention. It must be an act that leads the offeree reasona­reasona- bly to believe that a power to create a contract is conferred upon him. This applies to the content of the power as well as to the fact of its existence. It is on this ground that we must exclude invitations to deal or acts of mere preliminary negotiation, and acts evidently done in jest or without intent to create legal rela-rela­ tions. All these are acts that do not lead others reasonably to believe that they are empowered "to close the contract." So long as itit is reasonably apparent that some further act of the offeror is necessary, the offeree has no power to create contractual relations by an act of his own and there is as yet no offer. Communication. No act can induce another to believe that he is empowered to accept unless he is aware that the act has been performed. So it would seem to be essential that an offer shall be communicated to the offeree, and it has generally been held that acceptance is impossible prior to such communication. Thus, where a reward was offered by 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 held in some cases.220 0 Some judges have thought that where two offers, identical in terms, cross each other in the mail, there is no 2 contract.contract.:!l' In these two instances there is DOno contract if the only way to create a contract is by the machineiymachine.y of offer and acceptance, regarded as acts expressing consent. In the reward cases, the offeror has acted and has consented; the offeree has acted but his act was not an expression of consent. In the case of crossed offers, each party has acted and has expressed consent;

19 Fitch v. SlIedakerSnedaker (1868) 38 N. Y. 248; Vitty v. Eley (1900)(igoo) 515I App. Div. (N. Y.) 44; Williams v. West. Chi. St. Ry. (igoi) I9I Ill. 6io. Div.0 (N. Y.) 44; Williams v. West. Chi. St. Ry. (1901) 191 Ill. 610. 202 Gibbons v. Proctor (1891) 64 L. T. (N. S.) 594; disapproved by Pollock, COlltractsContracts (3d ed.) p. 21; also by Anson, Contracts (2d. Am. ed., Huffcut) p. 25; also by Ashley, Contracts, p. IS.iS. Smith v. State (1915) 151x5i Pac. (Nev.) 512; Dawkins v. SappillgtonSappington (1866) 26 Ind. 199; StolleStone v. DysertD)'sert (1878)(1878) 20 Kan. 123; Cummings v. Ga1l1~Gann (1866) 52 Pa. St. 484; Neville v. Kelly (1862) 12 C. B. (N. S.) 740. 2t 29 21 TinllTinn Z'.v. Hoffman (1873) 29 L. T. (N. S.) 271;27i; two judges contra.

HeinOnline -- 26 Yale L.J. 182 1916-1917 OFFEROFFER ANDAND ACCEPTANCEACCEPTANCE butbut inin soso doing,doing, neitherneither hashas knowinglyknowingly exercisedexercised aa powerpower con-con­ ferredferred byby thethe otherother andand neitherneither hashas beenbeen inducedinduced toto believebelieve thatthat hehe hashas suchsuch aa powerpower toto exercise.exercise. EachEach hashas donedone anan actact conferringconferring aa powerpower uponupon thethe other,other, andand eithereither oneone maymay nownow exerciseexercise thatthat powerpower byby aa subsequentsubsequent actact andand thusthus createcreate aa con-con­ tract.tract. ThereThere is,is, however,however, nono inevitableinevitable necessitynecessity inin ourour adop-adop­ tiontion ofof thethe machinerymachinery ofof offeroffer andand acceptance.acceptance. TheThe rulesrules ofof contract,contract, likelike allall otherother rulesrules ofof law,law, areare basedbased uponupon meremere mattersmatters ofof policy,policy, oror beliefbelief asas toto policy.policy. InIn thethe processprocess ofof ourour evolutionevolution wewe findfind thatthat somesome oror allall ofof usus areare followingfollowing aa customarycustomary rule.rule. WhenWhen wewe becomebecome consciousconscious ofof thisthis fact,fact, wewe trytry toto expressexpress thethe rulerule inin wordswords andand toto compelcompel othersothers toto obeyobey itit byby legislativelegislative command.command. WeWe maymay failfail inin ourour attempt,attempt, eithereither becausebecause thethe customcustom supposedsupposed isis notnot thethe customcustom ofof thethe powerful,powerful, oror becausebecause wewe havehave failedfailed toto expressexpress itit withwith accuracy,accuracy, oror becausebecause newnew lifelife conditionsconditions requirerequire newnew customs.customs. So,So, therefore,therefore, wewe maymay decreedecree thatthat twotwo acts expressingexpressing consent,consent, as inin thethe casecase ofof crossedcrossed offers, shallshall createcreate contractualcontractual relations;relations; oror thatthat wherewhere anan offeroffer hashas beenbeen published,published, thatthat actact empowers others toto createcreate contractual relationsrelations byby doingdoing thethe actsacts requested,requested, even thoughthough without knowledge ofof the request.request. It seems notnot improbableimprobable toto thethe 22 writer thatthat thisthis latter rulerule will prevailprevail inin thethe future.future.22 InIn thethe vast majoritymajority of cases, however, contracts will bebe made by offer and acceptanceacceptance as analyzed above.above. Time Limit. An offer having been made and a power havinghaving been thereby created, how long will this power continue to exist? The offeror is the creator of the power, and before it leaves his hands he may fashion it to his will. Such is the present of society. If he names a specific period for its existence, the offeree can accept only during tliisthis period. If the offeror names no period whatever, the power will be held to exist for a reasona­reasona- ble time, toto be determined as a fact by the court and dependent upon thethe circumstances.223 3 If the parties areare negotiating inin each other's presence, the reasonable time will usually be a very shortshort one; but ifif the offerorofferor indicatesindicates thatthat thethe power ofof acceptance isis toto be exercisedexercised in absentia, thethe reasonable timetime willwill be

2222 ThisThis isis thethe rulerule inin fact adoptedadopted byby thethe German CivilCivil Code,Code, sec.sec. 657. Ashley,Ashley, Contracts,Contracts,p.p. 13,13, says:says: "An"An offer ununcommunicatedcommunicated isis inconceivable."inconceivable." For casescases where itit was inin factfact conceived,conceived, seesee notenote 20,2o, supra.supra. 2323 LorillgLoring v.v. BostonBoston (r844)(844) 77 Met. (Mass.)(Mass.) 409;409; AverillAverill v. HedgeHedge (r838)(1838) 1212 Conn.Conn. 424-424. .

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24 considerablyconsiderably longer.longer.2i IfIf thethe timetime takentaken byby thethe offereeofferee wouldwould appearappear toto bebe reasonablereasonable toto aa reasonablyreasonably prudentprudent manman inin hishis position,position, thethe acceptanceacceptance isis operativeoperative eveneven thoughthough thethe offerorofferor diddid notnot intendintend thethe powerpower toto existexist forforso so longlong aa period.period. AA reasonablereasonable timetime maymay bebe longerlonger thanthan thethe offerorofferor inin factfact intended.intended. OnOn thethe otherother hand,hand, therethere seemsseems toto bebe nono goodgood reasonreason forfor holdingholding thatthat thethe powerpower ofof acceptanceacceptance hashas expiredexpired ifif itit cancan bebe shownshown asas aa factfact thatthat thethe offerorofferor intendedintended thatthat itit shouldshould stillstill exist.exist. AA reasonable time may be longer than the offeror intended, but reasonable time may25 be longer than the offeror intended, but itit cancan nevernever bebe less.less.25 Revocation.Revocation. InIn mostmost casescases thethe offerorofferor maymay terminateterminate thethe powerpower ofof acceptanceacceptance priorprior toto thethe endend ofof thethe specifiedspecified period,period, ifif any,any, oror ofof ~hethe reasonablereasonable time.time. InIn thethe firstfirst placeplace hehe maymay havehave expresslyexpressly providedprovided thatthat thethe powerpower shouldshould bebe subjectsubject toto revoca­revoca- tion,tion, eithereither byby noticenotice toto thethe offereeofferee oror withoutwithout suchsuch notice.notice. IfIf hehe providesprovides forfor aa revocationrevocation withoutwithout noticenotice andand bybT aa meremere changechange ofof hishis mentalmental state,state, hehe cancan scarcelyscarcely bebe saidsaid toto havehave conferredconferred anyany powerpower atat all.all. TheThe powerpower conferredconferred byby suchsuch anan offeroffer isis aa veryvery flimsyflimsy one indeed,indeed, forfor thethe validityvalidity ofof thethe acceptanceacceptance will dependdepend uponupon thethe offeror'sofferor's ownown willwill whenwhen he isis notifiednotified ofof thethe acceptance.acceptance. SuchSuch anan offeroffer isis littlelittle more,more, inin effect, thanthan anan invitationinvitation for bids.bids. IfIf thethe reserved powerpower ofof revocation isis toto bebe exercised by anan overtovert act,act, thenthen therethere isis a substantialsubstantial power of acceptance, thethe validity ofof thethe act of acceptance being thenthen not dependent upon thethe will ofof the offeror. Even though thethe power to revoke has not been expresslyexpressly reserved reserved by thethe offeror, itit can be said thatthat as a general rule he retains retains such a power. In such a case, however, the power to revoke revoke can be exercised only inin a particular manner. If the offer offer was made by publication, it has been held that it can be revoked either by actual notice to a claimant or by a notice 20 published in the same manner as was the offer.26 If the 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 25 All that would seem to be necessary isis overt action by thethe offeror sufficientlysufficiently indicating, his intentionintention thatthat thethe power shallshall continue.continue. This principle is involved principle is involved inin thethe factsfacts of MactierA1actier v.'iI. Frith (183o)(1830) 6 Wend.\Vend. (N. Y.) lo3; Tinn v. (N. Y.) 103; Tim~ 'iI. HoffmanHoffman (1873) 29 L. T.T. (N. S.) 271. See criticismscriticisms of Mactier v. Frith, of .Mactier 'iI. Frith, inin Langdell, SummarySummary ofof Cont.,COli f., sec.sec. 14, andand Ashley, Contracts,Contracts,2 p.p. 48. 0SZuey v. U. S. (1875) 92 U. S.73; Pollock says of this case: 26 Shuey 'iI. U. S. (1875) 92 U. S. 73; Pollock says of this case: "it seemsseems aa ratherrather strong piecepiece ofof judicialjudicial ."legislation." Wald's Pollock,Pollock, ContractsContracts (3d(3d ed.)ed.) p.p. 23.23. ToTo thethe writerwriter itit seemsseems nono strongerstronger thanthan areare

HeinOnline -- 26 Yale L.J. 184 1916-1917 OPFEROFFER ANDAND ACCEPTANCEACCEPTANCE waswas mademade byby personalpersonal communicationcommunication toto oneone oror moremore particularparticular persons,persons, itit can bebe revokedrevoked only byby givinggiving noticenotice toto them,them, suchsuch notice being effective only whenwhen received."received.727 IrrevocableIrrevocable Offers.Offers. It hashas beenbeen assertedasserted thatthat nono offeroffer cancan bebe irrevocable,irrevocable,2828 variousvarious reasonsreasons being advanced for suchsuch aa con-con­ clusion.clusion. ItIt may bebe thatthat by thethe prevailingprevailing rulerule of thethe commoncommon lawlaw offers are alwaysalways revocable;revocable; it may eveneven bebe true thatthat considerationsconsiderations of policy and convenience requirerequire thatthat allall offers shallshall be revocable;revocable; but itit is herehere insistedinsisted thatthat thethe questionquestion of theirtheir revocabilityrevocability isis notnot to bebe determineddetermined by rules of purepure logiclogic oror of mathematics, thatthat therethere isis no inevitableinevitable necessity or universal lawlaw foreclosingforeclosing discussion.discussion. TheThe principle here toto be adoptedadopted thethe decisionsdecisions on any other rulerule of thethe law.law. See alsoalso SearsSears'll. v. EasternEastem R. Co. (1867) 14 AllenAllen (Mass.) 433.433. TheThe samesame rulerule is adoptedadopted byby thethe Ger-Ger­ man CivilCivil Code, sec.sec. 658,658, andand byby thethe Jap. Civil Code, art. 530. 2727 ByrneB~'rIIe v. Van TienhovenTie1lho'llen (i88o)(1880) 5 C. P. D. 344; StevensonStevensol~ v. McLean (188o)(1880) 5 Q. B. D. 346. See also Dickinson v. Dodds (1876) 2 Ch. D. 463; Frank v. Stratford (1904)(19o4) 13 Wyo. 37. In the early case of Hurford v. Pile (1615)(1615) Cro. Jac. 483, an offer seems to have been held toto bebe irrevocable. The entire report isis as follows: Assumpsit. Whereas J. S. being in execution for fortyforty pounds, the defendant said, "Deliver J. S. out of execution, and what it cost you I will repay;" wherefore J. S. was discharged by the plaintiff. The defend­defend- ant for plea saith, that after the assumpsit,assmnpsit, and before the plaintiff had done any thing in thatthat business, he forbade him to meddle therein, and that he would not stand toto his promise. The plaintiff demurred; and it was adjudged for the plaintiff. Houghton, Justice, said, thatthat a man may discharge an assumpsit made to himself, but he cannot discharge an assumpsit made by himself: but, at another day, the defendant's moved, that it was a good plea, and that as long as nothing was done, it was but an executory promise. Doderidge. IfIf I promise to J. S. that if he build an house upon my land before Michaelmas, I will pay him a hundred pounds, and I counter­counter- mand it before he hath done any thingthing'concerning.concerning the house, it is a good countermand. . Houghton e contra; but he said, that may be considered in damages adjourtlatur.adjournatur. Afterwards, in Trinity term, was given for thethe plaintiff. See also Howe v. BcecheBeeche (1685)(1685) 3 Lev. 244. 28 "It"It is indispensableindispensable toto the making of a contract thatthat thethe wills of the contractingcontracting parties do,do, in legal contemplation,contemplation, concur at the moment of making it. An offer,offer, therefore,therefore, which the party making it has no power toto revoke, revoke, is a legal ." Langdell. Summary of the Law of COtltracts,Contracts,sec. 178,178, also sec. 4. SeeSee also, Wormser, The True Conception ofof Unilateral Contracts, 2626 YALE LAW JOURNAL,JoURNAL, 137, note; Lee,Lee, Contract, Jenks, Digest ofof Eng. Civ. Law, sec.sec. 195;i9"; Ashley, Contracts, sec.sec. 13.

HeinOnline -- 26 Yale L.J. 185 1916-1917 186 YALE LAW JOURNAL is of the same character as any other legal principle, and is to be determined by established custom, by positive legislation, and by considerations of policy and convenience.229 9 In various systems of law in other countries, and sometimes by statute in this country, offers are expressly declared to be irrevocable under certain circumstances.so0 These , however, might be construed as depriving the offeror of his privilege of revoking without depriving him of his powerp01.uer to revoke. It is not believed that they would be so construed'.construed. The view that an offer cannot be irrevocable seems based upon a failure to bear in mind the essential character of the relation as a power conferred upon the offeree. If an offer were a physical emanation, a sort of radio­radio- activity of a human body, no doubt a stop might always be put to it. If an offer were a state of mind, no doubt society could not ordain its continuance against the offeror's will.8s1 1 An offer, however, is an act creating the legal relation called a power to accept. The act cannot be revoked at all, for it is of yesterday. The resulting power is from society and can be maintained by 8 2 society indefinitely.s2indefinitely.

29 Langdell seemed to regard considerations of this sort as "irrelevant.""irrelevant!' See SummarySf,mmary of the Law of Contracts, sec. 15. so80 Swiss Code of Obligations, sec. 3: "One who makes an offer to another, and prescribes a definite time for acceptance, is bound by his offer until the expiration of the time fixed." German Civil Code, sec. 145: "One who has conferred upon another the power to close a contract is bound by his offer unless he has provided to the contrary." (But the Code provides that ifif no time is specified, the acceptance must take place within a brief period according to circum-circum­ stances. See secs. 147-150.) Sec. 658: "An offer of a reward isis revocable prior to the beginning of performance." Japanese Civil Code, art. 521: "An offer of a contract mad~made with a fixed period of time specified for acceptance cannot be withdrawn." Art. 524: "An offer made to a person at a distance without fixing a period of time for acceptance thereof,thereof, cannot be withdrawn for such a period of time as is reasonably necessary for the offeror to receive notice of the acceptance." By sec. 3645, Civil Code of Georgia, it is provided that a "party may withdraw his bid or proposition, unless a given time is agreed on inin which the other party may assent." See Black v. Maddo~Maddox (1898)(18gB) 1o4104 Ga. 157, 161.I6I. 81SI This was perhaps Langdell's view, although he often uses expressions inconsistent with it; and it is maintained in Ashley, Contracts, sec. 13. 82S2 In Adams v. LilldsellLindsell (1818)(i818) I1 B. & Ald.Aid. 681, it was said: "The defendants must be considered in law as'as making, during every instant of the time their letter was travelling, the same identical offer to the plain-

HeinOnline -- 26 Yale L.J. 186 1916-1917 OFFEROPFER ANDAND ACCEPTANCEACCEPTANCE

PhysicalPhysicalLimitation. Limitation. IrrevocabilityIrrevocability maymay havehave anyanyone one ofof severalseveral meanings:meanings: first,first, thatthat thethe offerorofferor hashas nono legallegal powerpower toto revokerevoke byby anyany means,means, lawfullawful oror unlawful;unlawful; second,second, thatthat hehe isis notnot legallylegally privilegedprivileged toto revoke,revoke, althoughalthough hehe maymay havehave thethe legallegal power;power; third,third, thatthat althoughalthough hehe hashas bothboth thethe legallegal powerpower andand thethe privilegeprivilege ofof revokingrevoking byby certaincertain means,means, thesethese meansmeans areare notnot withinwithin hishis presentpresent physicalphysical capacity.capacity. UnderUnder ourour lawlaw nearlynearly allall offersoffers areare forfor aa timetime irrevocableirrevocable inin thethe thirdthird sense.sense. RevocationRevocation cancan taketake placeplace onlyonly afterafter aa certaincertain fashion,fashion, commonlycommonly byby givinggiving actualactual noticenotice toto thethe offeree. SoSo longlong asas itit isis impossibleimpossible toto reachreach thethe offereeofferee withwith suchsuch aa noticenotice or toto dodo suchsuch otherother act asas maymay amountamount toto aa 83 revocation,revocation, thethe powerpower ofof acceptanceacceptance will continuecontinue toto exist.exist.33 ThisThis meansmeans thatthat althoughalthough thethe offerorofferor isis privilegedprivileged toto revokerevoke andand has thethe legallegal powerpower toto revokerevoke byby doingdoing certaincertain acts, thethe perform-perform­ ance of thesethese actsacts isis beyondbeyond his limitedlimited human capacity. Contractual Limitation.Limitation. An offeree'sofferee's powerpower isis irrevocable inin thethe secondsecond sense,sense, eithereither by the giving of notice or otherwise,othenvise, if thethe offer is putput in the formform of a conditional covenant or simple contract,contract,3'4 oror if thethe offer is accompanied by a promise notnot toto tiffs."tiffs." See alsoalso BostonBoston and MaineMaille R. Co. v. Bartlett (1849)(1849) 3 Cush. (Mass.)(Mass.) 224; Nyulasy v. RowanRowall (i8gi)(IBgI) 17 Vict.Viet. L. P.R 663. If an offer were at every instant revocable,revocable, these decisions would be wrong, and Cooke v. OxleyO~ley (1790)(1790) 3 T. R.R 653 would not have been overthrown. 3333See Ashley, COlltracts,Contracts,p. 34-34. 3434 O'Brie/£O'Brien v. Boland (1896) 166I66 Mass. 481; Watkins v. Robertson (i9o6)(1906) 105 Va. 269;26g; DanbinannDamb1llall/£ v. Rittler (i889)(1889) 70 Md. 380; McMillanMcMillall v. AmesAtIles (1885) 33 Minn. 257. Some cases refuse , if revocation preceded acceptance, but expressly on the ground of lack of consideration, and they indicate that the offer isis irrevocable if a con­ con- sideration is paid. Corbett v. CronkhiteCrollkhite (1909)(9o9) 239 Ill. 9; Crandall v. sideration is paid. Corbett Va. 895; Bishop Willig (1897)(IBg7) 166i66 Ill.Il. 233; GraJ'billGraybill v. BrughBm!Jh (1893)(IBg3) 89 Va. 895; Bishop Contracts, sec. 325. In Ii Ames, CqsesCases on Eql£it)',, p. 200,2oo, is the following note: "if after giving an option toto buy certain property the giver makes a will devising the specific property, the courts, to effectuate the supposed intention of the testator, give toto the devisee the land,land, ifif the option isis not exercised, and the proceeds, if the holder orol thethe option elects to buy. Drant v. Vause (1842) I1 Y. & Coll. 580;58o; EtIlussEmuss v. Smith (1848) 2 De G. & Sm. 722; In re Isaacs [IBg4][x894] 3 Ch. 506,5o6, 510;51o; IIIIn re Pyle [IBgS][1895] I Ch. 724." The devise is an apparent act of revocation, but a subsequentsubsequent acceptance isis effective, andand thethe acceptoracceptor isis entitled toto specificspecific performance.performance. Butler alldand Baker's CaseCase (1591)(159I) 3 Coke, 25 a, 26 b, presents a good illustrationillustration of anan irrevocableirrevocable power: "If AA makesmakes allan obligationobligation toto B andand delivers it to CC toto thethe use of B, thisthis is the deed of A presently; but ifif CC offers itit to to B, therethere BB may refuserefuse itit inin pais, andand therebythereby thethe obliga­obliga- tiontion will loselose itsits force."force." ThisThis isis aa covenant,covenant, delivered in escrow, con-con-

HeinOnline -- 26 Yale L.J. 187 1916-1917 188 YALEYALE LAWLAW JOURNALJOURNAL revokerevoke givengiven forfor aa considerationconsideration oror underunder seal.seal. InIn suchsuch casecase thethe offerorofferor isis nevernever privilegedprivileged toto revoke,revoke, andand hehe maymay notnot eveneven havehave thethe legallegal power.power. ItIt maymay bebe saidsaid thatthat thesethese areare contractscontracts andand areare notnot meremere offers;offers; butbut thethe factfact remainsremains thatthat inin allall suchsuch casescases thethe actact ofof thethe offerorofferor hashas conferredconferred uponupon thethe offereeofferee aa powerpower toto createcreate futurefuture relations,relations, aa powerpower thatthat isis inin allall respectsrespects similarsimilar toto thethe powerpower conferredconferred byby anyany offer,offer, aa power power toto -be'be exercisedexercised byby thethe voluntaryvoluntary actact ofof thethe offereeofferee alone.alone. TheThe offereeofferee isis notnot boundbound toto dodo thethe actact thatthat constitutesconstitutes thethe conditioncondition oror acceptance;acceptance; butbut ifif hehe doesdoes dodo thatthat act,act, new contractualcontractual relationsrelations areare created.created. WhenWhen thethe courtscourts enforceenforce thethe dutiesduties includedincluded amongamong thesethese relations,relations, theythey dodo soso expresslyexpressly onon thethe theorytheory thatthat therethere waswas anan offeroffer thatthat couldcould 35 notnot be revoked.revoked.3~ ditionalditional onlyonly upon B's assent.assent. AA has nono power of revocation,revocation, asas isis universallyuniversally held.held. ItIt isis duedue tot