Question

Discussion Scenario: Robib Motor Company (Robib), an automobile dealership that sold new cars, leased premises from certain landlords. One day, fire destroyed part of the leased premises, and Robib restored the leasehold premises. The landlords received payment of insurance proceeds for the fire. Robib sued the landlords to recover the insurance proceeds. Ten days before the trial was to begin, the defendants jointly served on Robib a document titled “Offer to Compromise Before Trial,” which was a settlement offer of $190,000. Robib agreed to the amount of the settlement but made it contingent on the execution of a new lease. The next day, the defendants notified Robib that they were revoking the settlement offer. Robib thereafter tried to accept the original settlement offer.

Was there a valid offer and acceptance? Support your answer with information from the learning materials.

Answer 1

In this specific situation as defendants offered Robib settlement and a proper contract was formed. As Robib was also agreed on the same situation but given his own condition for accepting the settlement on the new lease, proper acceptance from the Robib is present.
But in this is specific case defendants never confirm that we are going to settle after the execution of new lease hence they have full authority to revoke the settlement contract which was offered to Robib as we didn't agree for settling it before the trials.
The offer was valid but Robib did not accept the proposal on the instant and defendants have full authority to revoke the settlement offer as there was no formation of the contract on the time of proposal.