Offer and acceptance in contracts

A contract is a meeting of minds between two persons whereby one binds himself, with respect to the other, to give something or to render some service.[1] A contract is perfected by mere consent. From the moment of a meeting of the offer and the acceptance upon the object and the cause that would constitute the contract, consent arises. However, “the offer must be certain” and “the acceptance seasonable and absolute; if qualified, the acceptance would merely constitute a counteroffer.[2]

An offer is a unilateral proposition which one party makes to the other for the celebration of the contract.[3] Offer is a proposal made by one party (offerer) to another to enter into a contract. It is more than an expression of desire or hope. It is really a promise to act or to refrain from acting on condition that the terms thereof are accepted by the person (offeree) to whom it is made.[4] 

An offer is terminated if:
a. there is a rejection by the oferee;
b. incapacity of the offeror or offeree before acceptance is conveyed[5];
c. there is a counter-offer;
d. lapse of the time stated in the offer without acceptance being conveyed;
e. revocation of the offer before learning of acceptance; or
f. supervening illegality before acceptance.
On the other hand, acceptance is the manifestation by the offeree of his assent to the terms of the offer. Without acceptance, there can be no meeting of the minds between the parties.[6] Mere offer does not produce an obligation. In Malbarosa v. CA[7], the Supreme Court held that acceptance must be absolute, unconditional, and without variance of any sort from the offer. It must also be made known to the offeror. An acceptance not made in the manner prescribed is not effective but constitutes a counter-offer.

For an acceptance to be valid, it must be: (a) must conform with all the terms of the offer; (b) directed and communicated to the offeror and learned by him; (c) made within the proper time; and (d) communicated expressly or impliedly but it is not presumed.

[1] Article 1305, Civil Code.

[2] Insular Life v. Asset Builders Corp., G.R. No. 147410 (2004).

[3] Tolentino. Obligations and Contracts.

[4] De Leon. (2014). Obligations and Contracts.

[5] Article 1323, Civil Code.

[6] Supra note 4.

[7] Malbarosa v. CA, G.R. No. 125761 (2003).

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