§ 24 OFFER DEFINED

An offer is the manifestation of willingness to enter into a bargain, so made as to justify another person in understanding that his assent to that bargain is invited and will conclude it.

COMMENTS & ILLUSTRATIONS:

Comment:

a. Offer as promise. An offer may propose an executed sale or barter rather than a contract, or it may propose the exchange of a promise for a performance or an exchange of promises, or it may propose two or more such transactions in combination or in the alternative. In the normal case of an offer of an exchange of promises, or in the case of an offer of a promise for an act, the offer itself is a promise, revocable until accepted. There may also be an offer of a performance, to be exchanged either for a return promise (§ 55) or for a return performance; in such cases the offer is not necessarily a promise, but there are often warranties or other incidental promises.

Illustration:

1. A says to B, "That book you are holding is yours if you promise to pay me $ 5 for it." This is an offer empowering B, by making the requested promise, to make himself owner of the book and thus complete A's performance. In that event there is also an implied warranty of title made by A. See Uniform Commercial Code §§ 2-312, 2-401.

b. Proposal of contingent gift. A proposal of a gift is not an offer within the present definition; there must be an element of exchange. Whether or not a proposal is a promise, it is not an offer unless it specifies a promise or performance by the offeree as the price or consideration to be given by him. It is not enough that there is a promise performable on a certain contingency.

Illustration:

2. A promises B $ 100 if B goes to college. If the circumstances give B reason to know that A is not undertaking to pay B to go to college but is promising a gratuity, there is no offer.

c. Offer as contract. A promise made by the offeror as part of his offer may itself be a contract. Such a contract is commonly called an "option". See § 25.