Utah Contract law
Note: this section is incomplete.
Creation of a contract.
Generally, a contract requires: offer, acceptance, and consideration.
To create a contract, the parties have to agree on the terms of the contract. Whether they have agreed on the terms of the contract depends on whether [party’s name] made an offer that was accepted by [other party’s name].
A party makes an offer when [he] invites the other party to accept [his] terms in such a way that the party accepting the offer realizes that if [he] accepts the terms, both parties will become obligated to each other. The terms of the offer have to be clear and definite.
All of the important terms of the offer have to be accepted unconditionally. If the accepting party accepts some terms of the offer, but not others, or proposes different or additional terms, this becomes a counteroffer which then must be accepted unconditionally by the other party before a contract is formed.
An offer can be withdrawn at any time before it is accepted, but not afterwards.
- Nunley v. Westgates Casing Services, Inc., 1999 UT 100, ¶ 26, 989 P.2d 1077, 1086 (citing Engineering Assoc. v. Irving Place Assoc., 622 P.2d 784, 787 (Utah 1980)).
- Jones v. New York Life Insurance Co., 15 Utah 522, 50 P. 620 (1897).
A party accepts an offer when [he] agrees unconditionally to all of the terms. Unless an offer specifies that the terms need to be accepted in a certain manner, acceptance can be shown by something in writing, or orally, or by the conduct of the party who accepts the offer.
In order to decide whether the offer was accepted in this case, ask yourself whether [party’s name] communicated [his] acceptance of the offer so that an objective, reasonable person would understand that a contract had been made.
To create a bilateral contract, each party must promise to do something for the other party in exchange for something of value. This is called “consideration.” It can be a promise to do some act in exchange for the other party’s act. “Value” doesn’t necessarily have to be money, but it can be. Consideration for a unilateral contract is not a return promise, but some performance by the promisee.
- Resources Management Co. v. Weston Ranch & Livestock Co., 706 P.2d 1028 (Utah 1985).
- Latimer v. Holladay, 103 Utah 152, 134 P.2d 183 (1943).
- Restatement (Second) of Contracts § 71 (1979).
To create a contract, the promises of the parties must be spelled out clearly enough to be understood.