What is Conditional Acceptance?
Conditional acceptance occurs when a party attempts to accept a contract but with modified terms. This attempt voids the offer made and prevents a binding contract from being formed. If the parties wish to enter into a contract after conditional acceptance, they must restart the contract formation process.
Case Examples
- In Kolmar Americas Inc. v. Mycone Dental Supply Co ., No. 21-CV-02361 (CM), 2021 WL 5054300, at *6 (S.D.N.Y. Nov. 1, 2021), a party sent an email to the other party attempting to accept the offer but placing conditions on the acceptance. The Court determined that the conditional acceptance voided the offer, noting that “[c]onditional acceptance operates as a rejection or, at most, a counteroffer.”
- Conditional acceptance will halt the contract formation process, even if it is sent inadvertently. In Tyler Grp. Partners, LLC v. Madera, 564 F. Supp. 3d 944, 953 (D.N.M. 2021), a conditional acceptance of a contract was accidentally sent to the other party in the negotiations. Even though the transmission was accidental, the Court still deemed the conditional acceptance as valid and found that the contract had been rejected.
The Key Points
- Did either party change the terms of the contract? If so, then courts deem this a counteroffer, and the contract is not formed.
- If the parties still wish to contract, they must start the formation process again with another offer.
Further Reading
For more detailed information, see our related Contracts terms:
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