In a contract, the offeror is the party who makes the proposal. Whoever puts terms on the table first, with enough specificity that the other side could simply say “yes” and be bound, holds that role. The offeror sets the terms, chooses how acceptance must happen, and controls whether the offer stays open or gets pulled back before the other side responds.1Legal Information Institute. Wex – Offeror
What Makes Someone the Offeror
An offer has to show a genuine willingness to be bound if the other party agrees. Vague statements like “I might sell my truck someday” don’t count. The proposal needs enough specificity that a simple “yes” would close the deal. Tell your neighbor you’ll sell your lawnmower for $200 and you’re the offeror: there’s a clear item, a clear price, and a clear willingness to go through with it.1Legal Information Institute. Wex – Offeror
The offer itself is only one piece of a valid contract. The offeree has to accept. Both sides have to exchange something of value, called consideration. And everyone involved has to genuinely intend to create a legal obligation rather than make casual conversation.2Legal Information Institute. Contract
Offeror and Offeree
The offeror proposes. The offeree receives the proposal and decides what to do with it. A contract forms only when the offeree accepts the terms the offeror put forward.3Legal Information Institute. Offer
The offeree has three options: accept outright, reject, or respond with a counter-offer that changes the terms. Acceptance creates a contract. Rejection ends the offer. A counter-offer does both at once, killing the original and creating a new proposal, which flips the roles so the original offeree becomes the new offeror.4H2O. Restatement (Second) of Contracts 39 – Counter-Offers
Why Stores Usually Aren’t the Offeror
A common assumption trips people up here. Most advertisements, store displays, and price lists are not offers. They’re invitations to negotiate. They signal a willingness to do business without committing the seller to any particular deal.
The practical result is that the customer usually becomes the offeror. When you bring a shirt to a retail checkout counter, you’re proposing to buy it at the posted price, and the cashier can accept or decline on the store’s behalf. That’s why a store generally isn’t bound to honor a mistakenly low advertised price: the ad invited you to make an offer, it wasn’t an offer itself. Narrow exceptions exist where an advertisement is so specific that it leaves nothing open to negotiation, but in ordinary commerce, assume the ad is an invitation and the customer is the offeror.
What the Offeror Controls
The offeror is sometimes called the “master of the offer” because they set the ground rules.5Open Casebook. Restatement (Second) of Contracts 58 – Necessity of Acceptance Complying With Terms of Offer That control covers several things:
- The substance of the deal: subject matter, price, quantity, and any conditions.
- The method of acceptance. If the offer says acceptance must be in writing, a phone call won’t do. If it requires a specific action, a promise to perform later won’t work either.6Legal Information Institute. Uniform Commercial Code 2-206 – Offer and Acceptance in Formation of Contract
- The time to accept. An offer that says “you have until Friday” expires at the end of Friday, no matter how much more time the offeree wanted.
The Mirror Image Rule
Under the traditional mirror image rule, the offeree must accept the offer exactly as presented. Any change to the terms is not acceptance. It’s a counter-offer, which kills the original and starts a new negotiation with the roles flipped.7Legal Information Institute. Mirror Image Rule
The Uniform Commercial Code relaxes this rule for sales of goods between merchants. Under UCC Section 2-207, an acceptance that includes additional or different terms can still form a contract. Between merchants, those extra terms become part of the deal unless they materially change it, the original offer limited acceptance to its exact terms, or the other side objects within a reasonable time.8Legal Information Institute. Uniform Commercial Code 2-207 – Additional Terms in Acceptance or Confirmation
The Mailbox Rule
When parties aren’t negotiating in person, timing matters. The default rule is that an acceptance takes effect the moment the offeree sends it, not when the offeror receives it. Drop a signed acceptance letter in the mail on Tuesday and the contract forms Tuesday, even if the offeror doesn’t get the letter until Thursday.9Legal Information Institute. Mailbox Rule
The offeror can override this default by specifying in the offer that acceptance isn’t effective until received. Revocations work the opposite way: a revocation only takes effect when the offeree actually receives it. So if the offeror mails a revocation on Monday and the offeree mails an acceptance on Tuesday before the revocation arrives, the acceptance wins and a contract exists.
How Counter-Offers Flip the Roles
Offeror and offeree aren’t fixed identities. They shift with each counter-offer. Offer to sell your car for $15,000, hear $12,000 back, and your original offer is dead. The buyer is now the offeror of a new proposal, and you’re the offeree.4H2O. Restatement (Second) of Contracts 39 – Counter-Offers
Whoever holds the offeror role at a given moment controls the terms. In a drawn-out negotiation, that role can bounce back and forth several times. The person whose terms are ultimately accepted without modification is the offeror of the final binding contract.
Unilateral and Bilateral Offers
The type of offer the offeror makes shapes how acceptance works.
In a bilateral offer, the offeror asks for a return promise. Most everyday contracts work this way. You agree to pay rent; the landlord agrees to let you live there. The contract forms as soon as the promises are exchanged.
In a unilateral offer, the offeror asks for a specific action instead of a promise. A reward poster is the classic example: “$500 to anyone who finds my dog.” You can’t accept by promising to look. You accept by finding the dog and returning it. Only the offeror is bound from the start; the other party has no obligation to perform, but if they do, the offeror has to pay.
The distinction matters for revocation. With a bilateral offer, the offeror can revoke anytime before the offeree makes the return promise. With a unilateral offer, most courts hold that the offeror can’t revoke once the offeree has begun performing, even if the performance isn’t yet complete. Letting someone search for your dog for three days and then pulling the reward would be unfair, and courts generally say so.
How an Offer Ends
An offer doesn’t last forever. The Restatement (Second) of Contracts identifies several ways the offeree’s power to accept can terminate:10Open Casebook. Restatement (Second) of Contracts 36
- Revocation by the offeror. The offeror can generally pull the offer back any time before acceptance, as long as the revocation reaches the offeree. Once the offeree gets notice, the power to accept disappears.
- Rejection or counter-offer. If the offeree says “no” or changes the terms, the original offer is gone. The offeree can’t come back later and try to accept it unless the offeror puts it back on the table.
- Lapse of time. An offer with a deadline expires at the deadline. An offer without one expires after a reasonable time, which depends on the circumstances. Perishable goods have a shorter reasonable period than real estate.
- Death or incapacity. If the offeror dies or becomes legally incapacitated before acceptance, the offer terminates automatically, even if the offeree has no idea. The logic is that a dead person can’t be bound by a new contract.11Open Casebook. Terminating Offers – 4 Ways
When the Offeror Cannot Revoke
The general rule that the offeror can revoke at any time has two important exceptions.
Option Contracts
An option contract exists when the offeree pays the offeror something of value in exchange for keeping the offer open for a set period. Pay a property owner $1,000 for a 30-day option to buy their building and the owner can’t sell to someone else or withdraw the offer during those 30 days. The consideration locks the offer in place. This is common in real estate and business acquisitions, where the offeree needs time to arrange financing or do due diligence before committing.
Firm Offers Under the UCC
For sales of goods between merchants, the UCC creates a special kind of irrevocable offer that doesn’t require the offeree to pay anything to keep it open. A merchant who signs a written offer stating it will be held open can’t revoke during the stated period. If no period is stated, the offer stays open for a reasonable time. Either way, the irrevocable period can’t exceed three months. The writing requirement protects the offeror from being locked in by a casual spoken comment.
Both exceptions show that while the offeror starts with nearly total control, that control can be limited by agreement or by specific commercial rules designed to make business transactions more predictable.