Margaret finds a stray cat and takes it in. The following day she is speaking to some friends and learns that Kelly, a woman who lives some distance away, has lost a cat. She goes around to the home of Kelly, leaves the cat in the yard and leaves a note for Kelly. The next day she gets a voice mail message from Kelly thanking her. A few days later Margaret sees a notice in which Kelly offers to pay $500 to anyone who returns her cat. Margaret who needs some cash returns to Kelly's home and demands the $500 reward. Which of the following is true?
A) Kelly's notice is an invitation to treat.
B) Margaret did no know of the offer before she returned the cat. So she could not have been accepting the offer when she returned the cat. No contract arose. There is thus no obligation on Kelly to pay the $500.
C) By returning the cat, Margaret performed the contract and so has to be paid. Margaret's performance gives rise to a unilateral contract.
D) Because Margaret did not demand the $500 when she returned the cat, she cannot go back and request it. The offer has lapsed.
E) Kelly and Margaret have a bilateral contract.

Question

Quizplus · Accepted Answer

Kelly's notice offering a reward for her lost cat is not a binding offer, but rather an invitation to treat. Margaret was not aware of the reward offer and therefore could not have accepted it when she returned the cat. This means that no contract was formed, and Kelly has no obligation to pay the $500 reward to Margaret.

Margaret Finds a Stray Cat and Takes It In