Yile Xu – K Essay 3

The 1st issue is whether there is an enforceable contract between the Rachel and the
network.
The UCC governs contracts for goods and the common law governs contracts for service.
Here, hosting a new prime time cooking show is service. Therefore, common law applies.
Under common law of contract, an enforceable contract requires an offer, acceptance,
and consideration. An offer is the offeror conveys that he wants to enter a contract with the
offeree. An acceptance is the offeree agrees to the offeror’s terms. Consideration is a bargain
for exchange.
Here, in Jeff’s email he listed the name of offeree and the price to exchange for Rachel’s
service. In the email, the network specifically offers to pay Rachel $2.5 million to host 10
episodes of Rays of Rachel over the next six months. Therefore, Jeff’s email is an offer.
Under common law, when you accept an offer, you have to accept the exact terms of the
original offer.
Here, Rachel did not respond to Jeff’s email. She called Jeff and Rachel told Jeff that she
would not do the shows for less than $3.5 million. She was asking Jeff to change the terms of
offer. Therefore, Rachel’s phone call is not an acceptance.
In the phone call, Jeff made a second offer, where he offered a higher price.
Under common law, an acceptance must be received before the offer has been
terminated.
Here, Rachel failed to follow Jeff’s instruction to fax the acceptance to Jeff by the end of
the day. Therefore, Rachel’s letter is not an acceptance, either.
Therefore, there is no enforceable contract formed between Jeff and Rachel.

The 2nd issue is whether the network is liable to Rachel even though there is no contract
formed.
Under common law, if the offeree reasonably relies on the offer and it causes damages
based on the reasonable reliance, then the offeree is entitled with recovery from the offeror.
Here, Rachel might seek for $2 million damages because she had turned down a $2 million
cooking show to work at MAB because she relied on Jeff’s first and second offers. However, it
was Rachel’s own mistake that she did not accept Jeff’s second offer. It is not fair to blame
Jeff for Rachel’s own mistake.
Therefore, most likely the network will not be liable to Rachel for her reliance on Jeff’s
offer.