Figure Out the Offer & Acceptance Formula

Offer and Acceptance is a formula developed during the 19th Century, usually used to identify the moments before a contract, when all parties come to terms of agreement. This formula has been used to analyze the existing agreement between two parties. It is a common interpretation, that once the terms of offer and acceptance are clearly identified, a contract is drawn.

Terms of Offer and acceptance are included in a contract, with the offer being the indication of what a person is willing to put forward. The supporting party agrees to the terms of the offer which binds the agreement. The offer and acceptance can be documented in many ways via letter fax, email, newspaper or verbal communication.

Courts system usually use objective test to determine the difference between parties that are bounded by terms of offer and acceptance, or if the conditions between a party are standard agreements. Typical offers include four major points being, delivery date, price, terms of payment, and a detail description of the item. The terms of offer and Acceptance also outline the conditions for terms of service. If a offer does not include any of the four elements then it is not considered justifiable by court law and is viewed as a simple advertisement. Offer and Acceptance is the most important part of a contract.

One distinct fact of offer and acceptance is, that it does not always have to be communicated in writing. There can be a oral terms of offer and agreement, as well as an implied contract which can take on two forms. There are contracts that are applied in fact, where one party agrees to terms before hand although the actual service would take place at a later time.

One example of this is if a person orders a product and agrees to pay on delivery, however once the product is delivered they refuse to pay and this action puts them in breech of contract. Then there are the contracts that are applied in law also known as quasi contracts which gives the courts the right to remedy situations between parties. In essence this is not considered a actual contract since the court has the right to determine who is liable even in the instance where no formal agreement was made.


Offer and Acceptance agreements are essential anytime a contract is being drawn. It is the one thing that bind parties together as well as defining the conditions of service. There are a variety of contracts that exist and each legal contract contains terms of offers and acceptance.

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