Title: The $1800 Coffee Mug


Subject: Contracts: Offer & Acceptance

Activity overview. This activity is designed to evaluate whether an offer was made and accepted or whether the
exchange was a joke. The students will watch a 3- minute video clip from the Ellen Show in which she purports
to sell autographed mugs to two people, one for $1700 and the other for $1800:

Ingredients. Access to the Internet.

Running the activity. After showing the video, break the students into small groups of 3-4 student for a quick
discussion focusing on these questions and then bring the class back together to discuss:
Does the price seem a bit much for an autographed mug? Do you think it the exchange was a joke, or did the
exchange result in a contract, binding both women to pay? Applying the reasonable person standard, what
factors suggest it was just a joke? What factors suggest the exchange resulted in an enforceable contract?

Substitutions: Exercise can be adopted to a virtual environment by using team-based software or other virtual
discussion platform. Can be assigned as an online exercise, as well.

Suggestions. Points for discussion may include:

– Ellen is a comedian by occupation;
– The money was being raised for charity;
– A limited number of people could participate;

– Some people did not bid.
– She sold two cups at the end.
– Language she used

Review or follow-up. Choose something to sell, such as branded item from the school’s bookstore. Ask what
someone would pay for the item, and try to secure an “offer.” As soon as you get one accept it. Ask if there is a
contract. What factors suggest there is and what factors suggest there is not? There was offer and acceptance,
should be a contract. But would a reasonable person think that the student owes the payment? Why or why
not? Stronger or weaker case for an enforceable contact than the Ellen example?