Power of acceptance refers to the ability of one person to accept another person’s offer that is legally binding. The issue of power of acceptance arises most in contract law when disagreements arise over whether a contract offer actually was accepted. When someone extends an offer to another, it can be limited to a specific amount of time and can be revocable unless otherwise stated. If someone declines an offer or makes a counter-offer, the power of acceptance is terminated by the person for the original offer. Friction and lawsuits often arise over whether someone discussing the terms of the original offer amounted to declining the original offer or making a counter-offer.
[Last updated in August of 2021 by the Wex Definitions Team]