Reference no: EM132303483

On May 1, Kodzo, a textile manufacturer, mailed to Bonnie, a merchant, a written and signed offer to sell 1,000 bolts of blue denim at $40 per bolt. Each bolt would contain 25 square yards. The offer stated that “it would remain open for 10 days from the above date (May 1) and that it would not be withdrawn prior to that date.” Two days later, Kodzo, noting a sudden increase in the price of blue denim, changed his mind. After making great personal efforts to contact Bonnie, Kodzo sent Bonnie a letter revoking the offer of May 1. The letter was mailed on May 4 and received by Bonnie on May 5. Bonnie chose to disregard the letter of May 4. Instead, she continued to watch the price of blue denim rise. On May 9, Bonnie mailed a letter accepting the original offer. The letter was sent by mail and was properly addressed and contained the correct postage. However, it was not received by Kodzo until May 12, due to a delay in the mail. Bonnie demanded delivery of the goods according to the terms of the offer of May 1, but Kodzo has refused, claiming there is no contract

(a) Is there a contract? Explain. What rulings would follow this?

(b) If Kodzo was not a merchant, would there be a contract? Explain. (Does the Option Contract allow it to happen?)