Contracts and Sales Multistate Bar Practice Exam

When can an offer lapse due to time?

1. After an unspecified period of time

2. After usually no more than a month, unless otherwise specified

3. Immediately if the offer is not accepted

4. After the offeror revokes it

The correct answer is: After usually no more than a month, unless otherwise specified

An offer can lapse due to time when it is left open for an unspecified period. Generally, the law presumes that if no specific time frame is stated, offers will remain open for a reasonable amount of time, which is typically understood as no more than a month unless the parties specify otherwise. This principle ensures that both parties have a clear expectation of the offer's validity period and helps in avoiding confusion. If the offeror has not indicated a particular timeframe, the context of the transaction and customary practices in the industry may also play a role in determining the "reasonable time" frame. In contrast, an offer can indeed lapse immediately if it is not accepted if the offer stipulates an immediate deadline or condition for acceptance. However, this is not a standard feature for all offers. Revocation of the offer by the offeror is a separate matter. An offer can be revoked at any time before acceptance; thus, its lapse here is due to the actions of the offeror rather than the passage of time itself. The aspect of time lapse is not simply about the absence of acceptance but is focused on the natural expiration of the offer's viability within a timeframe that parties would reasonably understand. Hence, the correct interpretation aligns with the general legal principles