Calvin and Audrey Bones listed their ranch for sale with their real estate agent

Question

Calvin and Audrey Bones listed their ranch for sale with their real estate agent, Loren Johnson. On July 17, 1997, Dean Keller submitted an offer to buy the ranch for $490,000 payable to the agent. The terms of the offer stated that it would be withdrawn if not accepted by July 21 at 5:00 p.m. At 4:53 p.m. on July 21, the Boneses faxed a signed copy of the offer to their agent. Paragraph 15 of the offer stated in part that “upon execution by seller this agreement shall become a binding contract.” Loren Johnson, the seller’s real estate agent, did not telephone the buyer Keller to inform him of the acceptance until 5:12 p.m. on July 21, and then did so by leaving a message on Keller’s answering machine.

On July 22, the sellers had a change of heart and decided to sell to the current tenants of the ranch. Ms. Johnson called Keller to ask if he would be willing to allow the sellers to back out of the deal. Keller refused and brought suit to enforce “the contract.” The Boneses contend that no valid contract was formed because the sellers’ acceptance was not communicated to the buyer until after the deadline set forth in the offer had expired. Keller contends that as offeror he is the master of the offer, and the offer was silent with respect to the manner and time of acceptance. Thus, the manner and the time of acceptance must be rendered in a reasonable time and manner, where none is specified. The seller’s agent left a message on the buyer’s answering machine only 19 minutes after the seller signed the acceptance and 12 minutes after the 5:00 p.m. signing deadline, which according to Keller is a reasonable time and manner. Decide.

Explanation / Answer

The acceptance of an offer must be made within the time specified in the offer is a general rule of law The power to create a contract by acceptance of an offer terminates at the time specified in the offer CASE ANALYSIS: under a provision specifically designating the time within which notice must be given, that time is of the essence, and such provision is to be strictly construed. Keller's offer required that the Boneses accept in writing by 5 P.M. on July 21, 1997, through registered mail or delivering the acceptance to Keller personally Additionally, paragraph 15 of the offer states in part, "Time is of the essence of this agreement and each and every provision hereof." The voice message left on Keller's answering machine was not in writing, occurred after the deadline, and was not delivered by the means specified in the offer; thus, it could not constitute an acceptance The Boneses' late acceptance could constitute a counteroffer. A binding contract can result from the oral acceptance of such a counteroffer. The Boneses' signing of the offer by Keller would constitute the written embodiment of the counteroffer, and its oral acceptance by Keller could have resulted in a contract. However, Keller does not rely upon this theory, and in any event, there was no communication from Keller to the Boneses or their agent which could be interpreted as an acceptance of any counteroffer from the Boneses Conclusion: Granting summary judgment in favor of the Boneses because no contract existed.

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