This section is from the book "The Law Of Contracts", by William Herbert Page. Also available from Amazon: Commercial Contracts: A Practical Guide to Deals, Contracts, Agreements and Promises.
An offer, when once rejected, loses its legal force and can not be accepted thereafter so as to create a binding agreement,1 unless it is renewed after the rejection by the original offeror. No revocation of the offer is therefore necessary to prevent its subsequent acceptance after it has once been rejected. Since a counter-offer is equivalent to a rejection of the original offer,2 a counter-offer operates as a rejection, so that the original offeree can not accept the original offer so as to make a valid contract after his counter-offer has in turn been rejected.3 If a written offer is rejected, it ceases to exist, and if an oral acceptance is thereafter accepted in turn by the original offeror, such contract is oral and not a written contract within the meaning of the statute of frauds.4 A subsequent written contract between the same parties concerning the same subject-matter terminates a prior oral offer.5
1 Massachusetts. Kehlor Flour Mills Co. v. Linden, 230 Mass. 119, 119 N. E. 698.
Minnesota. Kull v. Wilson, 137 Minn. 127, 162 N. W. 1072.
Missouri. Anderson v. Hall, 273 Mo. 307, 202 S. W. 539.
Rhode Island. Freeman v. Poole, 37 R. I. 489, 93 Atl. 786.
Washington. John v. McClaine, 97 Wash. 95, 165 Ac. 1060.
See on question, Must the Rejection of Offer be Communicated to the Offeror, by Clarence D. Ashley, 12 Yale Law Journal, 419.
2 See Sec. 184.
3 Freeman v. Poole, 37 R. I. 489, 93 Atl. 786.
4 Blossom v. R. R. Co., 70 U. S. (3 Wall) 196, 18 L. ed. 43; Donaldson v. Kerr, 6 Pa. St. 486.
1 England. Sheffield Canal Co. v. Sheffield & Rotherham Ry. Co., 3 Eng. Ry. & Canal Cas. 121; Hyde v. Wrench, 3 Beav. 334.
United States. National Bank v. Hall, 101 U. S. 50, 25 L. ed. 822; Minneapolis & St. Louis R. R. Co. v. Columbus Rolling Mill Co., 119 U. S. 149, 30 L. ed. 376; Ortman v. Weaver, 11 Fed. 358; Arthur v. Gordon, 37 Fed.
558; Pope v. Hoopes, 90 Fed. 451, 33 C. C. A. 595.
Arkansas. Zearing v. Crawford, McGregor & Camby Co., 102 Ark. 575, 145 S. W. 226
California. Niles v. Hancock, 140 Cal. 157, 73 Ac. 840; McRae v. Ross, 170 Cal. 74, 148 Ac. 215.
Iowa. Clay v. Ricketts, 66 la. 362, 23 N. W. 755.
Kansas.Richardson v. Lenhard, 48 Kan. 629, 29 Ac. 1076.
Kentucky. Haynes v. Wilson (Ky.), 55 S. W. 209; Davis v. Parish, Litt. Sel. Cases (Ky.) 153; Shaw v. Ingram-Day Lumber Co., 152 Ky. 329, L. R. A. 1915D, 145, 153 S. W. 431.
Michigan. Eggleston v. Wagner, 46 Mich. 610, 10 N. W. 37.
Minnesota. Lewis v. Johnson, 123 Minn. 409, L. R. A. 1915D, 150, 143 N. W. 1127.
Montana. Glenn v. S. Birch & Sons Construction Co., 52 Mont. 414, 158 Ac. 834.
Pennsylvania. Henry v. Black, 218 Pa. St. 620, 63 Atl. 250.
Washington. Cook v. Story, 89 Wash. 109, 154 Ac. 147.
2 See Sec. 184.
A subsequent proposition by the offeree may show that it is not intended as a rejection of the offer. If a corporation delivers a written copy of a resolution passed by its board of directors as a memorandum under the statute of frauds, of an oral contract, the fact that the adversary party requests the passage of another resolution to cure possible technical objections to the original resolution is not a rejection of such offer.6
On the other hand, subsequent acts on the part of the offeree should not be treated as an acceptance, by him, of an offer which he has already rejected unless such intention on his part is clear. If a tender of a check as payment in full is rejected, the subsequent acceptance of the same check when tendered in such a way as not to amount to an offer of settlement in full, can not be regarded as an acceptance of the original offer.7
No contract, of course, exists, if the offer is rejected.8