- 1 Marks
BCL – L1 – SA – Q24 – Contract Law
Question
On May 1, Back-Talk Computer Store offered to sell five (5) computer servers to Gatekeeper Company for $5,000.00 each, delivery to be on May 30. Later that day (May 1), Gatekeeper responded that it would buy the computers only if they were delivered within three business days. Back-Talk notified Gatekeeper the next day, May 2, that it would not be able to deliver the goods within the time requested by Gatekeeper. Which of the following is true regarding Back-Talk’s offer?
A There is no contract between Back-Talk and Gatekeeper.
B Gatekeeper’s additional term became part of the contract, so Back-Talk is obligated to deliver the goods within three business days.
C Back-Talk’s offer was accepted by Gatekeeper.
D Gatekeeper may later accept Back-Talk’s May 1 offer if it is then willing to accept delivery in four weeks.
Answer
A
Explanation:
Under contract law, an offer can be accepted to form a contract, but a response that includes new or different terms is considered a counteroffer, which rejects the original offer. Back-Talk offered to sell servers with delivery on May 30. Gatekeeper’s response, requiring delivery within three business days, introduced a new term, making it a counteroffer rather than an acceptance. Back-Talk rejected this counteroffer by stating it could not deliver within three days. Therefore, no contract was formed, as there was no meeting of the minds on the terms. Option A is correct. Option B is incorrect because Gatekeeper’s term was not accepted. Option C is incorrect because Gatekeeper’s response was not an acceptance. Option D is incorrect because Gatekeeper’s counteroffer terminated the original offer, preventing later acceptance unless Back-Talk renews it.
- Tags: Acceptance, Contract Law, Counteroffer, Offer, UCC
- Level: Level 1
- Topic: Contract Law
- Uploader: Samuel Duah