Making Firm Offers Irrevocable Under NY UCC
In business transactions, offers can sometimes be withdrawn before acceptance, leading to uncertainty. However, the New York UCC provides a mechanism for making firm offers that are irrevocable without the need for consideration.
Understanding UCC §2-205: Firm Offers
What is a Firm Offer?
It's a written and signed promise by a merchant to keep an offer open for a specified period.
No Consideration Required:
Unlike general contract law, no additional consideration (something of value) is needed to make the offer binding.
Time Limit:
The offer can be irrevocable for the time stated, or if no time is stated, for a reasonable time not exceeding 90 days.
Benefits of Firm Offers
Reliability:
Provides assurance to the offeree that the offer will remain open, allowing time to consider without fear of withdrawal.
Efficiency:
Facilitates smoother negotiations and planning between merchants.
Requirements for a Valid Firm Offer
Must be made by a merchant.
Must be in writing and signed.
Should explicitly state that the offer will be held open.
Key Takeaways:
Use firm offers to create binding commitments without needing consideration.
Ensure your firm offer is properly documented to be enforceable.
Understand the time limitations to manage expectations effectively.
Disclaimer:
This article is for informational purposes only and does not constitute legal advice. Although I am an attorney, I am not your attorney, and reading this article does not create an attorney-client relationship. For advice pertaining to your specific situation, please consult a qualified attorney licensed in your area.
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