When is a rejection of an offer effective under common law?

• A. When mailed.
• B. When received.
• C. When promised.
• D. When the offeree begins performance.

Answer: (B)

The key idea is that rejections terminate an offer when they are actually communicated to the offeror. Unlike acceptances, which are governed by the mailbox rule and become effective upon proper mailing, rejections do not take effect until they are received. So mailing a rejection isn’t effective until the offeror gets it, and the offer remains alive until that receipt occurs. Beginning performance tends to indicate acceptance in a unilateral contract context, not a rejection, and merely promising to reject doesn’t terminate the offer by itself. Therefore, the rejection is effective when it’s received by the offeror.