A valid offer under common law needs three things working together: the offeror must genuinely intend to be bound, the terms must be definite enough for a court to enforce, and the proposal must actually reach the person who can accept it. The Restatement (Second) of Contracts captures the definiteness piece as “reasonable certainty,” which in practice means the offer identifies the parties, describes the subject matter, states a price, and fixes a quantity or scope.1H2O. Contracts – R2K Section 33 Miss any of the three requirements and there is no offer — which means no contract can form, no matter how enthusiastic the “acceptance” that follows.
Serious Intent to Be Bound
Courts judge intent objectively. What matters is not what the offeror was privately thinking but what a reasonable person in the offeree’s position would have understood from the words and conduct in front of them.2Legal Information Institute. Offer If a reasonable listener would believe you were making a serious commitment, you have made an offer. Private reservations don’t rescue you.
The objective test filters out the statements that look like offers but aren’t. Jokes. Offhand remarks. Expressions of frustration like “I’d sell this car for a dollar.” Preliminary feelers along the lines of “I might take around $200,000 for it” fail for the same reason: a reasonable listener hears a starting point for discussion, not a proposal ready to be closed. The common thread is that nobody walks away believing a deal is actually on the table.
Terms Definite Enough to Enforce
Even sincere intent isn’t enough if the terms are too vague for a court to work with. The Restatement puts the standard plainly: the terms must be certain enough to show whether a breach happened and to let a court fashion a remedy.1H2O. Contracts – R2K Section 33 Four categories of terms do the heavy lifting.
- Parties. The offer has to identify, or make identifiable, who is proposing the deal and who can accept it. The offeree can be a named person, a defined group, or in some reward situations the general public, but there must be a way to tell who holds the power of acceptance.
- Subject matter. The offer has to describe what is being exchanged with enough specificity that both sides can tell what performance looks like. “I’ll do some work on your house” is too thin. “I’ll replace the roof on your house at 42 Oak Street” works. The required detail scales with the complexity of the deal.
- Price. Under common law, the offer generally has to state the consideration. An offer to paint an office “for a fair price” typically fails because a court has nothing concrete to enforce. This is stricter than the rule for sales of goods, which can fill in a missing price.
- Quantity or scope. The offer must make clear how much is being provided — the number of items for a sale, the extent of the work or the length of employment for a service contract. Without this, a court cannot measure what was owed and cannot calculate damages.
The list is not completely rigid. A missing detail won’t always sink an offer if the court can fill the gap from trade custom, the parties’ prior dealings, or the surrounding circumstances. But the more terms left open, the more a court will suspect the parties were still negotiating. The Restatement itself treats open terms as evidence that no offer was intended at all.1H2O. Contracts – R2K Section 33
Communication to the Offeree
An offer has no legal force until it reaches the person who can accept it. The Restatement defines an offer as a “manifestation of willingness to enter into a bargain” made in a way that justifies the other person in understanding their assent will close the deal.3H2O. Restatement Second of Contracts Sections 24, 50 The manifestation has to actually get through — in speech, writing, email, or conduct that unmistakably conveys the terms.
The reward-poster scenario shows why. If someone posts a reward for a lost dog and you return the dog without ever seeing the poster, you haven’t accepted anything. You performed the act, but you never knew the proposal existed, so there was no mutual assent and no contract.
Are Advertisements Valid Offers?
Usually, no. Advertisements, catalogs, and price lists are treated as invitations to negotiate rather than offers. The Restatement says this directly: advertisements “are not ordinarily intended or understood as offers to sell,” even when they include detailed terms and pricing.4H2O. Contracts – R2K Section 26 A store running a newspaper ad is soliciting customers to come in and make purchase offers of their own, not binding itself to every reader who sees the page.
The exception matters. When an advertisement is “clear, definite, and explicit, and leaves nothing open for negotiation,” a court can treat it as a real offer. The leading case involved a store that advertised specific fur coats at a specific price on a “first come, first served” basis; the court held the terms were definite enough that the first qualifying customer could accept simply by showing up.5H2O. Contracts – Lefkowitz v Great Minneapolis Surplus Store Inc 1957 Reward posters work the same way: a named act, a named payment, and an invitation to anyone who performs. That mix of commitment and specificity is what crosses the line.
How a Valid Offer Can Still Disappear
An offer that satisfies every requirement above still has to survive until acceptance. Several events end it, and once it’s gone, any attempted acceptance is legally meaningless.
- Revocation. The offeror can pull the offer back at any time before acceptance. Revocation takes effect when the offeree learns of it, not when the offeror internally decides to withdraw.
- Rejection or counteroffer. A flat “no” kills the offer. So does a counteroffer, which operates as both a rejection and a brand-new offer running the other direction. This matters because common law applies the mirror image rule: acceptance must match the offer exactly, and any change in terms — even a small one — turns the response into a counteroffer rather than acceptance. A casual tweak during back-and-forth emails can destroy the very offer you were trying to accept.6Legal Information Institute. Counteroffer7Legal Information Institute. Mirror Image Rule
- Lapse of time. If the offer sets a deadline, it expires then. If not, it lapses after a reasonable time, which courts measure against the nature of the transaction, market volatility, and the way the offer was communicated.
- Death or incapacity. If either side dies or becomes legally incapacitated before acceptance, the offer terminates automatically. No notice is required; the offer simply ceases to exist.
There is one well-known way to shut off the offeror’s power to revoke. If the offeree pays separate consideration in exchange for the offeror’s promise to keep the offer open for a set period, the parties have an option contract, and the offer stays alive through that window regardless of the offeror’s change of heart.8Legal Information Institute. Option Contract Real estate deals use this routinely: a buyer pays a fee to lock in a price while completing inspections or lining up financing. Without the consideration, there is no option, just an ordinary offer the offeror can withdraw at will.
Where Common Law Ends and the UCC Begins
These rules govern common law contracts, which cover services, real estate, employment, and intellectual property. Contracts for the sale of goods run on a separate track under the Uniform Commercial Code, which was built to hold commercial deals together even when the paperwork is incomplete.9Legal Information Institute. UCC 2-102 – Scope If your transaction is a sale of goods, don’t assume the common law requirements above apply as written.
The practical gap is largest around missing terms. Under common law, leaving out an essential term like price usually means no enforceable offer exists. Under the UCC, the parties can form a binding contract even without an agreed price, because the Code fills the gap with “a reasonable price at the time for delivery.”10Legal Information Institute. UCC 2-305 – Open Price Term Similar gap-filling applies to the place of delivery and the time for payment. Quantity is the one term the UCC refuses to supply: a goods contract is not enforceable “beyond the quantity of goods shown” in any writing between the parties.11Legal Information Institute. UCC 2-201 – Formal Requirements Statute of Frauds The mirror image rule also softens under the UCC, which lets an acceptance add or change terms without automatically becoming a counteroffer.
If you’re drafting or evaluating a proposal and it isn’t a sale of goods, the common law framework is the one that governs. Confirm the intent, pin down the four terms, make sure the offer reaches the right person, and watch what you say in reply if you want to preserve your power to accept.