Ardente v. Horan

Rhode Island Supreme Court · Contracts

ContractsOffer and AcceptanceCounterofferSummary Judgmentmirror image ruleacceptancecounterofferconditional acceptance

Facts

Defendants offered residential property for sale, and plaintiff bid $250,000 through defendants' attorney. Defendants' attorney advised that the bid was acceptable, prepared a purchase and sale agreement at defendants' direction, and sent it to plaintiff for signature. Plaintiff signed the agreement and returned it with a $20,000 deposit and a letter asking for confirmation that certain furniture and fixtures would remain with the real estate because they would be difficult to replace. Defendants would not agree to include those items, did not sign the agreement, returned the agreement and deposit, and refused to sell the property.

Issue

Whether plaintiff's signed return of the purchase and sale agreement, accompanied by a letter requesting confirmation that specified items were part of the transaction, constituted an effective acceptance of defendants' offer or instead a conditional acceptance operating as a counteroffer. Also, whether summary judgment was proper when plaintiff failed to present a genuine issue of material fact to the trial court.

Rule

For an offer to form a bilateral contract, the offeree must communicate acceptance to the offeror in an overt manner. An acceptance must be definite and unequivocal; if it is equivocal, conditional, or adds limitations or additional conditions, it is a counteroffer requiring acceptance by the original offeror. Conditional language does not invalidate an acceptance only when the acceptance clearly and positively indicates assent regardless of whether the requested addition or modification is granted.

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One of 10 multiple-choice questions for this case. Pick an answer to see why.

In Portland, Maine, Rowan Mercer sent Elise Navarro a signed written offer to sell a lake cabin for $410,000. Elise signed the offer and returned it with the deposit check and a note stating, "I accept your offer, provided the dock, canoe rack, and basement workbench are included as part of the sale." Rowan never responded.

Was a contract formed when Elise returned the signed offer and note?

Explanation. An acceptance must be definite and unequivocal. If the offeree's response is conditional or adds limitations, it is a counteroffer requiring acceptance by the original offeror. Elise's note made her assent conditional on inclusion of additional items "as part of the sale," so no contract arose absent Rowan's acceptance.