Sarah makes a written offer to purchase a property in Louisville for $320,000 with an earnest money deposit of $5,000. Before the seller responds, Sarah's agent receives a phone call from Sarah saying she wants to withdraw the offer. Under Kentucky contract law, at what point does Sarah's right to revoke her offer end?
Correct Answer
A) When the seller signs the acceptance and it is communicated to Sarah or her agent
Under Kentucky contract law, an offeror may revoke an offer at any time before acceptance is communicated. A binding contract is formed — and the offeror's right to revoke ends — only when the offeree (seller) accepts the offer AND that acceptance is communicated to the offeror or their agent. Until Sarah receives or her agent receives notice of the seller's signed acceptance, she retains the right to withdraw.
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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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