A buyer, Mr. Chen, offers to purchase a property for $1,100,000. The seller, Ms. Davis, responds with a slight change to the possession date and a minor increase in the deposit amount, sending it back to Mr. Chen. Mr. Chen reviews the changes but dies suddenly before signing and returning the document to Ms. Davis. What is the legal status of the transaction?

Question: A buyer, Mr. Chen, offers to purchase a property for $1,100,000. The seller, Ms. Davis, responds with a slight change to the possession date and a minor increase in the deposit amount, sending it back to Mr. Chen. Mr. Chen reviews the changes but dies suddenly before signing and returning the document to Ms. Davis. What is the legal status of the transaction?

Answer options:

• The contract is binding, as Ms. Davis's changes were minor and indicated her acceptance in principle.
• The contract is valid and binding upon Mr. Chen's estate. ✅ There is no binding contract because the counter-offer was not accepted by Mr. Chen before his death.
• Ms. Davis can pursue specific performance against Mr. Chen's estate to compel the sale.

Correct answer: There is no binding contract because the counter-offer was not accepted by Mr. Chen before his death.

Explanation: A counter-offer revokes the original offer, and for a contract to be formed, there must be agreement (offer and acceptance). The death of a party before acceptance of a counter-offer means there was no consensus, thus no binding contract.