Maria submits a written offer to purchase a home in Boise for $425,000 with a 10-day acceptance deadline. On day 8, the seller crosses out the price and writes in $435,000, then signs and returns the document to Maria. Which of the following best describes the legal status of this transaction?
Correct Answer
D) A counteroffer exists, which terminates Maria's original offer and gives her the right to accept or reject
Under Idaho contract law, a material change to the terms of an offer — such as altering the purchase price — constitutes a counteroffer, not an acceptance. A counteroffer terminates the original offer and creates a new offer that the original offeror (Maria) may accept or reject. The seller's response is not a valid acceptance.
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Related Topics & Key Terms
Key Terms:
Related Concepts
Novation is the substitution of a new contract for an existing one, or the replacement of one party with a new party, with the consent of all parties involved. The original party is completely released from all obligations.
Offer and acceptance is the process by which one party proposes specific terms for a contract and the other party agrees to those exact terms, creating mutual assent. This mutual agreement, also called a meeting of the minds, is an essential element of every valid contract.
An option contract gives one party the exclusive right, but not the obligation, to purchase or lease a property at a specified price within a specified time period. The buyer pays option consideration to keep the option open.
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