Petterson v.

Pattberg
Court of Appeals of New York
161 N.E. 428 (N.Y. 1928)

Rule of Law
Any offer to enter into a unilateral contract may be withdrawn before the act requested to be done has been
performed.

Facts
Petterson owned a property upon which the defendant owned a bond secured by a mortgage. The mortgage was
payable to the defendant in monthly installments, but the defendant offered to grant Petterson a $780 reprieve on the
total mortgage if he paid it off in full by a certain date. Petterson went to defendants house with cash prepared to pay off
the entire mortgage before the date. Before Peterson tendered any money, the defendant informed him that he had sold
the mortgage to a third party and thus revoked his offer. Consequently, Petterson had to pay the third party the full price
of the mortgage. The executrix of Pettersons will (plaintiff) brought suit against the defendant for the $780 lost. The trial
court found in favor of the executrix and the appellate court affirmed. The defendant appealed.

Issue
May an offer for a unilateral contract be revoked if the offeror knows of the offerees imminent intention to accept?

Holding and Reasoning (Kellogg, J.)

Yes. An offer to enter into a unilateral contract may be withdrawn before the act requested to be done has been
performed, even if the offeror knows of the offerees intention to accept and revokes at the very last second before
acceptance. The defendants offer to Petterson was an offer to enter into a unilateral contract because the defendant
conditionally promised to reduce the mortgage payment upon Pettersons payment in full. And, because the offer to enter
into a unilateral contract could be withdrawn at any time before the payment was made, the defendant properly revoked
his offer when Petterson showed up at his house. Even though Petterson had money in hand and the defendant knew he
was going to perform his end of the agreement, the revocation was still done before Petterson tendered the money and
so is valid. The judgments of the lower courts are reversed and the executrixs suit is dismissed.

Dissent (Lehman, J.)

The only reason the money was not tendered in this case is because the defendant refused to accept the payment. By its
very terms, a promise to accept payment must become binding when an offer to pay is made. Thus the defendants
revocation was too late.