Mack's Bar sent Olive Outlet an order for 200 cases of olives to be shipped "as soon as possible." The day Olive Outlet receives Mack's order, it does not have 200 cases of olives in stock, so it sends Mack's Bar 140 cases of olives and 60 cases of onions. Olive Outlet notifies Mack's Bar that they are shipping the onions in lieu of olives. Later that day, Mack's Bar phones Olive Outlet and tries to revoke the offer. According to the Uniform Commercial Code (UCC), which of the following statements holds true to this situation?

A. Olive Outlet has accepted and breached the contract.

B. Mack's Bar must reject the shipment as the goods are nonconforming.

C. Mack's Bar must accept the shipment as they were notified.

D. Olive Outlet's shipment is considered a counteroffer.

business-law

D) Olive Outlet's shipment is considered a counteroffer.

Explanation:

Depending on how Mack reacts to Olive's shipment, this can be considered either:

A. Olive Outlet has accepted and breached the contract. D. Olive Outlet's shipment is considered a counteroffer.

Since Mack simply decided to reject Olive's shipment and revoke their initial offer, Olive's actions would be considered a counter offer. Olive did not have to accept Mack's offer in first place since an order to promptly ship goods invites the seller to ship the goods promptly or promise to do so as soon as possible. Olive did not have to ship the goods, since no contract was made.

Since Olive decided to ship other goods, it can be considered a counter offer which Mack is free to accept or reject. Since he chose to reject it, there is nothing Olive can do about it.