Acceptance of a Bilateral Contract by Performance?

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jlayne
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Acceptance of a Bilateral Contract by Performance?

Postby jlayne » Fri Dec 03, 2010 9:18 pm

I am studying for my Contracts final, and I am using Emanuel's flashcards "Law in a Flash." Card #37 in the Contracts box asks, "Does an offeree accept an offer to enter into a bilateral contract by performing?"

The answer the card supplies is: "No, an offeree accepts a bilateral contract offer by promising to perform. It's a unilateral contract offer that's accepted through performance . . . "

This confuses me, because I thought that offers for bilateral contracts, although seeking a promise, COULD be accepted by performance, since the beginning of performance is basically a promise. Which is correct? (and if there are any jurisdictional splits, please include.)

Thanks!

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OGR3
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Re: Acceptance of a Bilateral Contract by Performance?

Postby OGR3 » Fri Dec 03, 2010 9:22 pm

I would suggest reading Restatement 2d § 30(2).

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dailygrind
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Re: Acceptance of a Bilateral Contract by Performance?

Postby dailygrind » Fri Dec 03, 2010 9:24 pm

that really seems like a question that was aimed at familiarizing you with the difference between bilateral/unilateral rather than anything which holds a deeper meaning re: acceptance.

Zindras
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Re: Acceptance of a Bilateral Contract by Performance?

Postby Zindras » Fri Dec 03, 2010 9:25 pm

Restatement 2d 62. Effect of Performance by Offeree Where Offer Invites Either Performance or Promise.

Generic20101L
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Re: Acceptance of a Bilateral Contract by Performance?

Postby Generic20101L » Fri Dec 03, 2010 9:29 pm

Zindras wrote:Restatement 2d 62. Effect of Performance by Offeree Where Offer Invites Either Performance or Promise.


yeah, bilateral would have to invite the acceptance by performance, i would think.

OP I don't think its that big of a deal and I wouldn't worry too much about it. Sometimes thinking about bilateral/unilateral distinctions just gets you more confused.

There is sometimes a very fine line between a uni/bi K.

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Gatriel
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Re: Acceptance of a Bilateral Contract by Performance?

Postby Gatriel » Fri Dec 03, 2010 10:09 pm

I'm working on CivPro right but, but I think if the offeree executes performance of a bilateral contract in the presence of the offeror then the offer is deemed accepted and the offeror is bound by the terms of his offor.

ogurty
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Re: Acceptance of a Bilateral Contract by Performance?

Postby ogurty » Fri Dec 03, 2010 10:14 pm

The question is silly because it oversimplifies, but maybe it would seem clearer if you remember that the ONLY defining quality of a bilateral contract is that both parties make PROMISES. While performing can entail a promise (if it's interpreted as such), it's entirely possible to perform partially without ever making a promise to complete performance.

The problem is not important, unless your professor is needlessly pedantic, because no one ever says "Here is my offer to make a bilateral contract". Bilateral is simply a term we use to describe exchange of promises.

jlayne
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Re: Acceptance of a Bilateral Contract by Performance?

Postby jlayne » Fri Dec 03, 2010 10:20 pm

Thanks for the replies. Interestingly, about 30 cards later in the stack, there is another question where an offer is made to pay a certain sum "if you promise by noon on Saturday to have the job finished before . . . " In the hypo, the person performs the requested work. It is a bilateral contract.

The correct answer, according to the card: There is acceptance of the bilateral contract by performance, as long as the work is complete before the return promise is due and the offeror is notified of completion before the return promise is due.

Kind of confusing, but this answer is what I thought was correct in the beginning.

However, what about the case where there is no time specified for the return promise? Wouldn't performance still constitute acceptance, as long as the offeror was notified?

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JCougar
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Re: Acceptance of a Bilateral Contract by Performance?

Postby JCougar » Fri Dec 03, 2010 10:21 pm

You can't possibly accept a bilateral contract with performance, because it wouldn't be a bilateral contract then. It doesn't become a bilateral contract until you return a promise.

If the offer is unclear as to whether you should accept by return promise or performance, R.2d 62 governs.

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dailygrind
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Re: Acceptance of a Bilateral Contract by Performance?

Postby dailygrind » Fri Dec 03, 2010 10:25 pm

JCougar wrote:You can't possibly accept a bilateral contract with performance, because it wouldn't be a bilateral contract then. It doesn't become a bilateral contract until you return a promise.


this is kind of a semantical waste of time. i mean, i think you can accept by performance because a bilateral contract classifies the K - i offer to leap into a lake on friday if you give me 5 bucks. promise for promise. instead of saying anything, you whip out your wallet and give me 5 bucks. k formed, accepted by performance. i doubt it's going to be a relevant point on the exam tho.

Generic20101L
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Re: Acceptance of a Bilateral Contract by Performance?

Postby Generic20101L » Fri Dec 03, 2010 10:28 pm

dailygrind wrote:
JCougar wrote:You can't possibly accept a bilateral contract with performance, because it wouldn't be a bilateral contract then. It doesn't become a bilateral contract until you return a promise.


this is kind of a semantical waste of time. i mean, i think you can accept by performance because a bilateral contract classifies the K - i offer to leap into a lake on friday if you give me 5 bucks. promise for promise. instead of saying anything, you whip out your wallet and give me 5 bucks. k formed, accepted by performance. i doubt it's going to be a relevant point on the exam tho.


This.

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JCougar
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Re: Acceptance of a Bilateral Contract by Performance?

Postby JCougar » Fri Dec 03, 2010 10:28 pm

dailygrind wrote:
JCougar wrote:You can't possibly accept a bilateral contract with performance, because it wouldn't be a bilateral contract then. It doesn't become a bilateral contract until you return a promise.


this is kind of a semantical waste of time. i mean, i think you can accept by performance because a bilateral contract classifies the K - i offer to leap into a lake on friday if you give me 5 bucks. promise for promise. instead of saying anything, you whip out your wallet and give me 5 bucks. k formed, accepted by performance. i doubt it's going to be a relevant point on the exam tho.


You're right...it is a semantical waste of time. But if you do what you outlined above, is it not just a unilateral K supported by R.2d 62?

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JCougar
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Re: Acceptance of a Bilateral Contract by Performance?

Postby JCougar » Fri Dec 03, 2010 10:30 pm

dailygrind wrote:
JCougar wrote:You can't possibly accept a bilateral contract with performance, because it wouldn't be a bilateral contract then. It doesn't become a bilateral contract until you return a promise.


this is kind of a semantical waste of time. i mean, i think you can accept by performance because a bilateral contract classifies the K - i offer to leap into a lake on friday if you give me 5 bucks. promise for promise. instead of saying anything, you whip out your wallet and give me 5 bucks. k formed, accepted by performance. i doubt it's going to be a relevant point on the exam tho.


Now that I think about it some more...that's not promise for promise. Only one party has made a promise.

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Re: Acceptance of a Bilateral Contract by Performance?

Postby JazzOne » Fri Dec 03, 2010 10:31 pm

JCougar wrote:
dailygrind wrote:
JCougar wrote:You can't possibly accept a bilateral contract with performance, because it wouldn't be a bilateral contract then. It doesn't become a bilateral contract until you return a promise.


this is kind of a semantical waste of time. i mean, i think you can accept by performance because a bilateral contract classifies the K - i offer to leap into a lake on friday if you give me 5 bucks. promise for promise. instead of saying anything, you whip out your wallet and give me 5 bucks. k formed, accepted by performance. i doubt it's going to be a relevant point on the exam tho.


You're right...it is a semantical waste of time. But if you do what you outlined above, is it not just a unilateral K supported by R.2d 62?

I think this becomes more dicey if the performance takes a long time. What if I promise to pay you $100 if you promise to build a fence around my yard by Friday. Then you start building the fence. Can I tell you to stop and rescind my offer? Or have you accepted the offer by beginning to perform? Is the beginning of performance a promise to complete? If you got tired of working after an hour, could you stop and tell me that you reject the offer?

Edit: I'm too lazy to look up the Restatement, so if it addresses this directly, I apologize for my ignorance.

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JCougar
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Re: Acceptance of a Bilateral Contract by Performance?

Postby JCougar » Fri Dec 03, 2010 10:35 pm

JazzOne wrote:
JCougar wrote:
dailygrind wrote:
JCougar wrote:You can't possibly accept a bilateral contract with performance, because it wouldn't be a bilateral contract then. It doesn't become a bilateral contract until you return a promise.


this is kind of a semantical waste of time. i mean, i think you can accept by performance because a bilateral contract classifies the K - i offer to leap into a lake on friday if you give me 5 bucks. promise for promise. instead of saying anything, you whip out your wallet and give me 5 bucks. k formed, accepted by performance. i doubt it's going to be a relevant point on the exam tho.


You're right...it is a semantical waste of time. But if you do what you outlined above, is it not just a unilateral K supported by R.2d 62?

I think this becomes more dicey if the performance takes a long time. What if I offer to pay you $100 if you build a fence around my yard by Friday. Then you start building the fence. Can I tell you to stop and rescind my offer? Or have you accepted the offer by beginning to perform? Is the beginning of performance a promise to complete? If you got tired of working after an hour, could you tell me that you reject the offer?

Edit: I'm too lazy to look up the Restatement, so if it addresses this directly, I apologize for my ignorance.


The beginning of performance creates an option contract under R.2d 45, which means you can't revoke as long as the offeree completes within a reasonable amount of time.

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JazzOne
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Re: Acceptance of a Bilateral Contract by Performance?

Postby JazzOne » Fri Dec 03, 2010 10:37 pm

JCougar wrote:The beginning of performance creates an option contract under R.2d 45, which means you can't revoke as long as the offeree completes within a reasonable amount of time.

Interesting, but since it is an option, the offeree can walk away without no liability. That's odd.

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JCougar
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Re: Acceptance of a Bilateral Contract by Performance?

Postby JCougar » Fri Dec 03, 2010 10:40 pm

JazzOne wrote:
JCougar wrote:The beginning of performance creates an option contract under R.2d 45, which means you can't revoke as long as the offeree completes within a reasonable amount of time.

Interesting, but since it is an option, the offeree can walk away without no liability. That's odd.


But if you breach, then the offeror doesn't have to perform either. If you've already begun your performance, that's to your own detriment then.

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dailygrind
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Re: Acceptance of a Bilateral Contract by Performance?

Postby dailygrind » Fri Dec 03, 2010 10:41 pm

JCougar wrote:
dailygrind wrote:
JCougar wrote:You can't possibly accept a bilateral contract with performance, because it wouldn't be a bilateral contract then. It doesn't become a bilateral contract until you return a promise.


this is kind of a semantical waste of time. i mean, i think you can accept by performance because a bilateral contract classifies the K - i offer to leap into a lake on friday if you give me 5 bucks. promise for promise. instead of saying anything, you whip out your wallet and give me 5 bucks. k formed, accepted by performance. i doubt it's going to be a relevant point on the exam tho.


You're right...it is a semantical waste of time. But if you do what you outlined above, is it not just a unilateral K supported by R.2d 62?


i don't really think so. the term bilateral/unilateral defines the contract, and in the contract we exchanged promises. the method of acceptance makes it resemble unilateral, but that doesn't change the fact that the negotiated terms of the contract are p for p.

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dailygrind
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Re: Acceptance of a Bilateral Contract by Performance?

Postby dailygrind » Fri Dec 03, 2010 10:43 pm

JazzOne wrote:
JCougar wrote:The beginning of performance creates an option contract under R.2d 45, which means you can't revoke as long as the offeree completes within a reasonable amount of time.

Interesting, but since it is an option, the offeree can walk away without no liability. That's odd.


the express terms as you made them are an option. if you said something like, build me a fence, make it by friday, and i'll give you a hundred bucks, now you have a contract that you're justified in relying on. but "if you've got it up by friday" is another story altogether.

jlayne
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Re: Acceptance of a Bilateral Contract by Performance?

Postby jlayne » Fri Dec 03, 2010 10:43 pm

JCougar, the R2d. of Contracts, 45, which you site, specifically comments that this is only for unilateral contracts. (see comment a).

The note says: "a. Offer limited to acceptance by performance only. This Section is limited to cases where the offer does not invite a promissory acceptance. Such an offer has often been referred to as an "offer for a unilateral contract." Typical illustrations are found in offers of rewards or prizes and in non-commercial arrangements among relatives and friends...." [emphasis mine]

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JCougar
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Re: Acceptance of a Bilateral Contract by Performance?

Postby JCougar » Fri Dec 03, 2010 10:45 pm

dailygrind wrote:
JCougar wrote:
dailygrind wrote:
JCougar wrote:You can't possibly accept a bilateral contract with performance, because it wouldn't be a bilateral contract then. It doesn't become a bilateral contract until you return a promise.


this is kind of a semantical waste of time. i mean, i think you can accept by performance because a bilateral contract classifies the K - i offer to leap into a lake on friday if you give me 5 bucks. promise for promise. instead of saying anything, you whip out your wallet and give me 5 bucks. k formed, accepted by performance. i doubt it's going to be a relevant point on the exam tho.


You're right...it is a semantical waste of time. But if you do what you outlined above, is it not just a unilateral K supported by R.2d 62?


i don't really think so. the term bilateral/unilateral defines the contract, and in the contract we exchanged promises. the method of acceptance makes it resemble unilateral, but that doesn't change the fact that the negotiated terms of the contract are p for p.


The contract can't be described as "unilateral" or "bilateral" until the manifestation of mutual assent. If performance manifests mutual assent, it's unilateral. If a return promise manifests mutual assent, it's bilateral. Until there is mutual assent, it's only an offer, and offers can't be bilateral or unilateral.

jlayne
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Re: Acceptance of a Bilateral Contract by Performance?

Postby jlayne » Fri Dec 03, 2010 10:45 pm

By implication then, an offer looking to a bilateral contract that is accepted by performance on the part of the offeree would not become an option contract under this section.

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JCougar
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Re: Acceptance of a Bilateral Contract by Performance?

Postby JCougar » Fri Dec 03, 2010 10:48 pm

jlayne wrote:JCougar, the R2d. of Contracts, 45, which you site, specifically comments that this is only for unilateral contracts. (see comment a).

The note says: "a. Offer limited to acceptance by performance only. This Section is limited to cases where the offer does not invite a promissory acceptance. Such an offer has often been referred to as an "offer for a unilateral contract." Typical illustrations are found in offers of rewards or prizes and in non-commercial arrangements among relatives and friends...." [emphasis mine]


The nature of the contract isn't determined by the offer, it's determined by the mode of acceptance. So if you accept by performance, it's a unilateral contract.

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Re: Acceptance of a Bilateral Contract by Performance?

Postby BCLS » Fri Dec 03, 2010 10:49 pm

JazzOne wrote:
JCougar wrote:The beginning of performance creates an option contract under R.2d 45, which means you can't revoke as long as the offeree completes within a reasonable amount of time.

Interesting, but since it is an option, the offeree can walk away without no liability. That's odd.

I was under the impression that once performance started, the offer becomes irrevocable for the offeror, AND when read in combination with section 62 (2) the part performance constitutes a promise for offeree to complete.
Last edited by BCLS on Fri Dec 03, 2010 10:50 pm, edited 1 time in total.

jlayne
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Re: Acceptance of a Bilateral Contract by Performance?

Postby jlayne » Fri Dec 03, 2010 10:49 pm

JCougar wrote:You can't possibly accept a bilateral contract with performance, because it wouldn't be a bilateral contract then. It doesn't become a bilateral contract until you return a promise.


The contract can't be described as "unilateral" or "bilateral" until the manifestation of mutual assent. If performance manifests mutual assent, it's unilateral. If a return promise manifests mutual assent, it's bilateral. Until there is mutual assent, it's only an offer, and offers can't be bilateral or unilateral.[/quote][/quote][/quote]

Doesn't this violate the principle that the offeror is the MASTER of his contract? Doesn't his offer determine in what manner it can be accepted? IF so, why would it not be proper to classify the contract as bilateral based upon an offer looking to a bilateral contract?




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