## Facts

- A railroad sought quotations for rail purchases with March 1880 delivery.
- The manufacturer offered to sell 50-lb. iron rails at $54 per gross ton, spot cash, F.O.B. cars at its mill, for March delivery, in a quantity range of 2,000 to 5,000 tons, requesting notice of acceptance before December 20, 1879.
- The railroad telegraphed an order for 1,200 tons “as per” the manufacturer’s offer terms, thus proposing a quantity below the offer’s stated minimum.
- The manufacturer refused to fill the 1,200-ton order at the offered price.
- The next day, the railroad attempted to order 2,000 tons “as per” the original offer; the manufacturer denied that any agreement existed.
- The railroad sued in federal court, claiming a contract was formed by its later telegram accepting 2,000 tons; the manufacturer denied contract formation.
- A jury returned a verdict for the manufacturer, and judgment was entered accordingly; the railroad sought Supreme Court review.

## Issues

1. Whether an offeree’s response that changes a material term of the offer (quantity) constitutes an acceptance or a counteroffer that rejects the original offer.
2. Whether, after making a counteroffer/rejection, the offeree can later accept the original offer within the offer’s stated time limit and thereby form a contract.

## Decision

- The Supreme Court affirmed the judgment for the manufacturer.
- The railroad’s 1,200-ton “order” was not an acceptance of the 2,000–5,000-ton offer; it varied the offer’s terms and therefore operated as a rejection and counterproposal.
- Once rejected, the original offer was no longer open to acceptance; the railroad’s later attempt to accept the original quantity did not bind the manufacturer.
- Submitting legal questions to the jury was not reversible error where the verdict reached the legally correct result.

## Legal Principles

- A reply to an offer that purports to accept but varies the offer’s terms is a counteroffer and rejection, terminating the offeree’s power to accept the original offer.
- An offer terminated by rejection cannot be accepted later by the offeree unless the offeror renews or assents anew.
- At common law, mutual assent requires that acceptance match the offer’s terms; a material variance prevents contract formation.

## Conclusion

Because the railroad’s initial response changed the offered quantity, it rejected the manufacturer’s offer and extinguished the power to accept it later; the railroad’s subsequent attempt to accept the original terms did not create a contract, so judgment for the manufacturer was affirmed.


Minneapolis & St. Louis Ry. Co. v. Columbus Rolling-Mill Co., 119 U.S. 149 (1886)