California Real Estate SalespersonContractsMedium
A seller mails a written offer to sell a rental property to a buyer for $600,000. Two days later, before the buyer has responded, the seller changes her mind and mails a letter to the buyer revoking the offer. The buyer receives the seller's revocation letter on Monday but had already mailed an acceptance letter on Sunday, before receiving the revocation. Under California contract law, is a binding contract formed?
- ANo, because the seller revoked before the buyer's acceptance was received
- BNo, because revocation is effective the moment it is mailed
- CYes, but only if the seller later confirms the sale in writing
- DYes, because the buyer's acceptance was mailed before the buyer received the revocation
Show answer & explanationAnswer & explanation
Correct answer: D. Yes, because the buyer's acceptance was mailed before the buyer received the revocation
Under the mailbox rule, an acceptance is effective upon dispatch (mailing), while a revocation is effective only upon receipt by the offeree. Since the buyer mailed acceptance before receiving the seller's revocation, a binding contract was formed at the moment of mailing.
Why the other options are wrong
- A. Incorrect—revocation must be received to be effective, and acceptance was already mailed before receipt.
- B. Incorrect—revocation is effective upon receipt, not upon mailing.
- C. Incorrect—no further written confirmation is needed once acceptance is properly dispatched.
Mailbox Rule (Offer/Revocation Timing)
Acceptance of an offer is effective when sent (mailed), but revocation of an offer is effective only when received by the offeree.
- Acceptance is effective upon dispatch, not receipt.
- Revocation is effective only upon receipt by the offeree.
- An offer can be revoked any time before acceptance is dispatched, unless it is an option contract.
Memory trick: Acceptance flies fast (mailed=binding); revocation must land (received=effective).