Module 1 IRAC - irac essay response PDF

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Issue No. 1: Did Steve’s statements constitute an offer to Tina to sell him her Steinway grand piano? Rule: An offer requires a demonstrated willingness to enter into a bargain made in such a way that a reasonable person would be justified in thinking that his or her acceptance of that offer is invited and would conclude the bargain.

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Analysis: An offer can be broken down into four parts (1) a manifestation of willingness (2) to enter a bargain (3) made in such a way that justifiably appears to invite an offeree’s acceptance, (4) and that the offeree’s acceptance of that bargain would justifiably appear to conclude the transaction.

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In the case at hand, Steve expresses to Tina that “if someone gave [him] a handful of cash right now [he] would give them [his] piano”. Courts use an objective approach to determine whether an offer was made based on what the offeror says, and not on what he or she is thinking. If the offerors' words justify the other person's belief that their assent is invited and would conclude the bargain, then it would not matter what the offerors actual beliefs or intentions were. 3 Steve’s words and his conduct show a clear inclination towards a manifestation of willingness to enter into a bargain. Steve could well argue that his words were said in jest, and that he did not actually intend for them to be taken seriously. Again, using the objective approach, court’s would lend special consideration to whether a reasonable person would have realized that the words were not meant to be taken seriously. Steve’s comments would likely fail this test, since Tina clearly sought reassurance from Steve’s statement, and even went as far as clarifying whether Steve would give her the piano for 50 dollars. Even though Steve chuckles, the circumstances show that he was at the very least outwardly expressing a manifestation of willingness to enter a bargain, regardless of what he was actually thinking or what his intentions were.

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Restatement (Second) of Contracts § 21 (Am. Law. Inst. 1981)

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Michael B. Kelly, Inside Contract Law, What Matters and Why, (2011) pg. 28 Id. at pg. 30

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As to the third and fourth parts of the offer, Tina was justified in believing that Steve’s comment appeared to invite her acceptance of the bargain and that this acceptance would conclude in an exchange where she would get Steve’s piano and Steve would get the 50 dollars to be able to eat. This is further supported by the fact that Tina actually gave Steve the 50 dollars, and there is no indication to the contrary to show that Steve did not keep the money. Conclusion: The court is likely to find that even if Steve did not intend to extend an offer to Tina to exchange his piano for 50 dollars, his actions are likely to be interpreted by a reasonable person to be inviting assent and conclusion of the bargain.

Issue No. 2: If Steve’s statements were a valid offer, were the terms of the offer definitive enough for a contract to be formed? Rule: The terms of a contract are considered definitive when they are (1) sufficiently clear enough to provide the court with a basis for determining whether there has been a breach, and (2)

a promise must be sufficiently clear enough to provide the court with a basis for awarding a remedy for the breach. 4 Analysis: An offer is not required to have every detail specified by the parties to be considered definitive. 5 Usually, the courts will prevent enforcement of contracts when the terms are so unclear or incomplete that enforcement is either impossible or inappropriate. If Steve were to argue that the terms of the contract lack definiteness since there is no specified time for fulfilling the contract, or any details as to the method of delivery, this argument would likely be overruled by the simplicity of the offer, which was simply that Steve would sell Tina his piano for 50 dollars. The first component of definiteness is evident in that both Steve and Tina knew what piano Steve was referring to. Steve also accepted an exact amount of dollars, whereas at first, he was willing to accept a “handful of cash”, Tina countered his vague offer with a specific amount, 50 dollars. The court has sufficient details with this to determine whether there has been a breach. If Tina did not give Steve 50 dollars, but instead gave him 40, then the court could use this as a basis in its decision. Similarly, the fact that Steve did not provide Tina with the piano when she showed up the following day, is a clear indication to the court that a breach was made. The second component of definiteness is that a promise must be sufficiently clear to provide a court with a basis for awarding a remedy for breach. Usually, if the court is able to determine breach, the promise will be definite enough to allow the court to determine how performance could be remedied. In this case, since Steve refused to give Tina the piano after they had agreed on a price, the court could easily determine the remedy since the terms of the offer were fairly simple. Even in cases where there is limited information, courts will usually fill in the gaps or missing terms if they have determined that the parties intended to contract. Conclusion: The court is likely to find that the terms of Steve’s offer were definite enough because there was sufficient clarity offered for determining what the breach was, and how that breach could be remedied. In this case, had Tina not paid Steve the 50 dollars, this would have shown sufficiently that Tina breached the agreement and would have provided the court a basis for remedy. Similarly, the fact that Steve did not go through with his promise of giving Tina the

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Restatement (Second) of Contracts § 33 (Am. Law. Inst. 1981)

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Michael B. Kelly, Inside Contract Law, What Matters and Why, (2011) Pg. 36

piano after taking her 50 dollars, provides the court with a reasonable basis for determining breach, and for awarding a remedy for that breach....