Question

Abe said to Bill, "I'll give you $100 for that bracelet." Bill replied, "$125." Abe said, "No thanks." Bill then said, “Fine, I’ll take $100.” Abe said “I am no longer interested.” Bill insists there is a contract. Who is correct? Why?

Answer 1

In simple terms we can define contract as a written or spoken agreement within two or more parties over a certain matter. Here, a proposal is given by one which must be accepted by the other person and only then can we consider it a contract. Contracts are enforceable by law, so when a party disobeys the contract aggrieved person can seek for legal remedies. On the other hand when proposal is not accepted by other parties ,there is no place of contract thus, no legal help for that given situation.

On the above given situation when Abe proposed to Bill to take his bracelet at exchange for $100 which he rejected. Thus, no contract was formed at the first hand. Later on when Abe changed his mind to not buy that bracelet for $100 he was not legally binded to buy it . Here, case of Abe is correct . If on the other hand Bill would have agreed to sell it at $100 and Abe would have promised to buy it at the given price but changed his mind later on then we can say he was under contract to buy that bracelet.