What Is A Counter Offer?

For a contract to exist there must be an offerIt is important to note that A has the opportunity
and there must be an acceptance of that offer.at any time after making the offer to withdraw it
These are the fundamental principles of contractprovided that B has not already accepted.
law.The only time this rule would not apply is when A
Once the offer has been made, and provided thathas contractually said that the offer should remain
there was an intention to create legal relations andavailable for acceptance for a certain time period
valuable consideration was given on the contract,before it can be withdrawn (e.g. I will give you
then as long as that offer is accepted in athree days to decide before I withdraw my
reasonable timeframe than a contract will beoffer).
made.A counter offer is simply a rejection of the
What is a reasonable timeframe? Well in theoriginal offer by the other party with another
absence of the party stating otherwise (e.g. youoffer being made. For example A offers to sell to
have two days to accept my offer) then theB his dining room table and chairs for $500. B
courts will determine what is reasonable. Forsays that's too high and he will pay $450. By
example if A offers B the chance to purchase A'smaking the $450 offer B has made a counter
car for $10,000 and B says he will think aboutoffer and has therefore rejected A's original $500
then B cannot turn up six months later and sayoffer. If A say's no to B's counter offer of $450
to A "I accept your offer sell me your carthen B cannot then turn around and say okay I
please".will buy the table and chairs $500. If A no longer
This offer would have terminated in the passagewanted to sell table and chairs to B at that price
of time should A not wish to sell his car any morehe no longer had to. He is not bound by the
for $10,000.original $500 offer.