Opinion ID: 6103947
Heading Depth: 3
Heading Rank: 3

Heading: Action Inconsistent with Intent

Text: In Antwine, the Court recognized the principle that the power of acceptance terminates when the offeree has knowledge that the offeror has undertaken “some act inconsistent” with the offer. 73 The opinion does not elaborate further. Sections 42 and 43 of the Restatement are comparatively more specific in requiring the offeror’s actions to be definite and clearly inconsistent with an intent to proceed with the proposed bargain. 74 In describing “what constitutes a revocation,” Section 42 states that “[a]ny clear manifestation of unwillingness to enter into the proposed bargain is sufficient. Thus a statement that property offered for sale has been otherwise disposed of is a revocation.” 75 But objectively “equivocal” language may be insufficient 73 Antwine, 199 S.W.2d at 485. 74 RESTATEMENT (SECOND) OF CONTRACTS §§ 42, 43. 75Id. § 42 cmt. d; see, e.g., Normile v. Miller, 326 S.E.2d 11, 18 (N.C. 1985) (“In this case, plaintiff-appellants received notice of the offeror’s revocation of the counteroffer in the afternoon of August 5, when Byer saw Normile and told him, ‘[Y]ou snooze, you lose; the property has been sold.’”); Bancroft v. Martin, 109 So. 859, 860 (Miss. 1926) (“The contract for the sale of the land entered into by the Martins with Rennyson and Passera, which came to the knowledge of the appellant before he attempted to accept the Martins’ 25 to effect a revocation 76 or may create a fact issue about “what a reasonable person in the position of the offeree would have thought.” 77 offer of sale, constituted a revocation thereof.”); Wm. Weisman Realty Co. v. Cohen, 195 N.W. 898, 899 (Minn. 1923) (“We think that such offer, based upon no consideration, is revoked by a sale with notice.”); Watters v. Lincoln, 135 N.W. 712, 715 (S.D. 1912) (“[P]laintiff should not be permitted to recover in this action for the reason that prior to the time he sent his night message of acceptance he was aware of the fact that defendant had sold and disposed of the land in question, thereby making it impossible for defendant to make a sale thereof to plaintiff.”); Thurber v. Smith, 54 A. 790, 791 (R.I. 1903) (“The fact of a sale would show that the person giving the notice no longer had the power to carry out the offer. If such was not the purpose of the notice, it would be meaningless. We think that its purpose and effect was a revocation of the defendant’s offer.”). 76 RESTATEMENT (SECOND) OF CONTRACTS § 42 cmt. d (stating that equivocal language “may not be sufficient”). Compare Bovino v. Amazon.com, Inc., No. 13-CV-02111-MSK-MJW, 2015 WL 13612169, at  (D. Colo. Sept. 15, 2015) (quoting RESTATEMENT (SECOND) OF CONTRACTS § 42 illus. 4 (offeror’s statement did not effect a revocation where it was “equivocal enough to suggest that the proposed bargain may yet be entered into”), with Hoover Motor Express Co. v. Clements Paper Co., 241 S.W.2d 851, 853 (Tenn. 1951) (offer revoked where offeror’s agent informed offeree that “he didn’t think they were going through with the proposal. . . . That they had other plans in mind and he would let me know. He was not sure if he was going through with the original proposition.”), and RESTATEMENT (SECOND) OF CONTRACTS § 42 illus. 5 (offer is revoked where offeror informs offeree “Well, I don’t know if we are ready. We have not decided, we might not want to go through with it.”). 77 1 WILLISTON, supra note 24, § 5:8 (“[I]f the offeror uses equivocal or inexplicit language, it may not be sufficient to operate as a revocation. Whether it has that effect will ordinarily be a question of fact, depending upon what a reasonable person in the position of the offeree would have thought.” (citing Stone Mountain Props., Ltd. v. Helmer, 229 S.E.2d 779 (Ga. Ct. App. 1976), which held that whether the offeree knew that the property had been sold was a fact question, and other cases where no fact issue existed and revocation was determined as a matter of law)); cf. BPX Operating Co. v. Strickhausen, 629 S.W.3d 189, 198, 202-03 (Tex. 2021) (applying an “unequivocally inconsistent” test with respect to implied ratification contrary to the express terms of the parties’ existing contract and finding a fact issue 26 Section 43 similarly gives effect to “definite” action inconsistent with an intent to proceed with the offer, explaining that the rule “does not apply to cases where the offeror takes no action or takes equivocal action.” 78 Examples of actions that are insufficient to revoke a prior offer are said to include “mere negotiations with a third person”; “a definite offer to a second offeree” that is consistent with an intent to honor the outstanding offer; and “[e]ven a binding contract with a third person [made] expressly subject to any rights arising under the outstanding offer.” 79 The implied-revocation standard quoted in Antwine is not stated in such terms, but there, the offeror’s actions (as reported to the offeree) would satisfy the Restatement’s formulation because taking property off the about intent to alter the parties’ bargain arising from the party’s objective manifestations of intent). 78 RESTATEMENT (SECOND) OF CONTRACTS § 43 & cmt. d; see 1 WILLISTON, supra note 24, § 5:10 (“If the offeror has not in fact engaged in the reported conduct, or if the conduct engaged in is equally consistent with an intent to deal with the offeree as with some other individual, the offer is not deemed to be revoked.”). 79 RESTATEMENT (SECOND) OF CONTRACTS § 43 cmt. d; see Nott v. Superior Ct., 204 Cal. App. 3d 1102, 1103 (Ct. App. 1988) (“Statements at an arbitration regarding the value and disposition of a case are directed to the resolution of the matter by an adjudication by the arbitrator. They do not address the resolution of the matter by contract. Hence, they manifest no intention to reject or revoke the outstanding section 998 offer. We see no inconsistency between continued contemplation of contractual resolution while putting one’s best foot forward in the adjudicative proceeding.”); Mitchell v. Brimer, 1987 WL 5319, at  (Del. Ch. Jan. 12, 1987) (“The mere fact that the seller is entertaining another offer, without more, will not give rise to a mandatory inference that the seller no longer intends to accept a potential buyer’s then outstanding offer.”); S. Oil Co. v. Wilson, 56 S.W. 429, 432 (Tex. Civ. App. 1900, no writ) (offeror’s sale of its stock did not impliedly revoke offer to sell real and personal property because the stock sale did not divest the offeror of the title to the property, so no inconsistency existed). 27 market for sale is definite action clearly inconsistent with an intent to sell it. Here, the Bank’s agreement with Angel constitutes a revocatory act because it is “some act inconsistent” with the offer to release the judgment and is definite action clearly inconsistent with an intent to go forward with that offer. The court of appeals erroneously concluded that Tauch retained the power of acceptance because “an assignment agreement that would not take effect until April 14 is not an action that would prevent the bank’s [offer] from materializing into a contract with Tauch should he accept the proposal before April 14.” 80 The court’s reliance on the agreement’s effective date was misplaced for a couple of reasons. First, inconsistent action need not rise to the level of a binding contract with a third party to manifest revocatory intent. Second, the existence of such a contract, even executory in nature, suffices. The dispositive issue is not the offeror’s ability to enter the proposed bargain but continued willingness to do so. Taking action that renders the offeror unable to consummate the deal obviously bears on willingness to do the deal, so a binding contract for the same subject matter may objectively speak to the offeror’s intent. But so too could an invalid contract with a third party 81 or even actions without the existence of any other contract at all. 82 80 580 S.W.3d at 817. See Palmer v. Schindler Elevator Corp., 133 Cal. Rptr. 2d 339, 341-42 81 (Ct. App. 2003). See, e.g., Antwine v. Reed, 199 S.W.2d 482, 485-86 (Tex. 1947) (offer 82 to sell land was revoked by action of instructing real estate broker to take property of the market); Norca Corp. v. Tokheim Corp., 227 A.D.2d 458, 458-59 28 The facts in Antwine are illustrative. There, although the offeror had indeed entered a contract to sell the property to a third party, the only information that had been communicated to the offeree was that the offeror had instructed his agent to take the property off the market. 83 Though not contractual in nature, we held that this action was sufficient to impliedly revoke the prior offer. 84 Importantly, taking the property off the market would not have prevented the offeror from honoring the offer, yet the power of acceptance terminated because that action manifested the offeror’s intent not to sell the property to the offeree. Another illuminating aspect of our analysis is the conclusion that, even though the bank’s contract with the third party was executory in nature, the vendee could nonetheless enforce it against the bank’s successor for specific performance: “One who, with knowledge, actual or constructive, of the executory contract acquires the legal title under or through a deed or mortgage executed by the vendor subsequently to (N.Y. App. Div. 1996) (offer stating different terms of sale from original outstanding offer revoked the prior offer because the price terms were inconsistent); Wilson v. Sand Mountain Funeral Home, Inc., 739 So. 2d 1123, 1125 (Ala. Civ. App. 1999) (“Sand Mountain’s action in suing Wilson regarding his alleged wrongful acquisition of stock and intentional devaluation of stock constitutes a ‘definite action inconsistent with an intention to enter into the proposed contract’ [to purchase Wilson’s stock shares for $25 each]. Thus, Wilson’s power of acceptance was terminated when he was served with the lawsuit.”(citations omitted)). 83 Antwine, 199 S.W.2d at 484 & 486 (recounting that “[t]he first notice Reed had of the bank’s revocation of its offer to him was communicated by the broker on or about the 28th day of December, 1944,” which was to the effect that the “property was off the market”). 84 Id. at 486. 29 an executory contract for the sale of the land . . . , may be compelled, at the suit of the vendee under the executory contract, to perform the contract by conveying the legal title, if the conditions are such that such relief could have been granted against the vendor if he had not transferred the legal title.” 85 That is to say, even though the terms of the agreement contemplated future performance by one or both parties, it was nonetheless binding. By the same token, when a party binds itself to an executory contract with a future effective date, it is bound to that agreement. Under our precedent, and as articulated in the Restatement, the relevant inquiry is not “whether the Bank took action that would prevent the offer from materializing into a contract” but whether “a reasonable person, in the position of the offeree, would regard the offer as withdrawn.” 86 The focus is on the offeror’s objective manifestations of intent. 87 Applying that standard to the undisputed facts in this case, the assignment agreement objectively manifests the Bank’s intent to pursue other collection methods (as foreshadowed in Holden’s April 11 email) instead of settling with Tauch and releasing the judgment. As 85 Id. at 485 (quoting Langley v. Norris, 173 S.W.2d 454, 457 (Tex. 1943)). 86 1 WILLISTON, supra note 24, § 5:10. RESTATEMENT (SECOND) OF CONTRACTS §§ 42 cmt. b (“[T]he offeree is 87 justified in relying on the offeror’s manifested intention regardless of any undisclosed change in the offeror’s state of mind.”), 43 cmt. a (indirectly communicated revocation is subject to the same qualifications as a directly communicated revocation); 1 WILLISTON, supra note 24, § 5:9 (“[N]o case goes so far as to hold that a change of mind on the part of the offeror, not manifested by an overt act, will operate as a revocation.”). 30