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Firm Offers Without Consideration

Updated: Oct 29

Making Firm Offers Irrevocable Under NY UCC

Making Firm Offers Irrevocable Under NY UCC


In business transactions, offers can sometimes be withdrawn before acceptance, leading to uncertainty. However, the New York UCC provides a mechanism for making firm offers that are irrevocable without the need for consideration.


Understanding UCC §2-205: Firm Offers


  • What is a Firm Offer?

    It's a written and signed promise by a merchant to keep an offer open for a specified period.


  • No Consideration Required:

    Unlike general contract law, no additional consideration (something of value) is needed to make the offer binding.


  • Time Limit:

    The offer can be irrevocable for the time stated, or if no time is stated, for a reasonable time not exceeding 90 days.


Benefits of Firm Offers


  • Reliability:

    Provides assurance to the offeree that the offer will remain open, allowing time to consider without fear of withdrawal.


  • Efficiency:

    Facilitates smoother negotiations and planning between merchants.


Requirements for a Valid Firm Offer


  • Must be made by a merchant.


  • Must be in writing and signed.


  • Should explicitly state that the offer will be held open.


Key Takeaways:


  • Use firm offers to create binding commitments without needing consideration.


  • Ensure your firm offer is properly documented to be enforceable.


  • Understand the time limitations to manage expectations effectively.

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