What is the result of a material change in the terms of an offer upon acceptance?

When there is a material change in the terms of an offer upon acceptance, it is considered a counteroffer. A counteroffer occurs when the offeree responds to the offer with different terms, which signifies that they are not accepting the original offer but instead proposing a new one. This legal principle is well established in contract law.

In the context of contract negotiations, a counteroffer effectively nullifies the original offer, as it indicates that the offeree does not agree to the initial terms and seeks to modify them. The original offeror is then free to accept, reject, or negotiate further regarding the new terms presented in the counteroffer. This shift in the negotiation dynamics demonstrates the importance of mutual assent in forming a valid contract.

Understanding this concept is crucial because it highlights that acceptance must be unequivocal; any alteration in essential terms transforms the interaction into a new negotiation rather than a simple acceptance of the original offer.