Lapse of offer happens when an offer expires or terminates and ceases to exist. For example, Death of the offeree causes an offer to lapse, but the death of the offeror does not always do so. An offer comes to an end and is no longer open to acceptance under the following circumstances.
(a) By notice: If the offeror gives notice of revocation to the other party, expressly withdraws the offer and the offer comes to an end. An offer may be revoked any time before acceptance but not afterward. Once an offer is accepted there is a binding contract. The acceptance of an offer becomes binding on the offeror as soon as the acceptance is put in course of communication to the offeror so as to be out of the power of the acceptor. But any time before this happens the offer may be revoked. A proposal is sent by X to Y and is accepted by Y by letter. The proposal might have been revoked any time before the letter of acceptance was posted but it cannot be revoked after the letter is posted. The notice of revocation does not take effect until it comes within the knowledge of the offeree.
(b) By lapse of time: When the proposer prescribes a time within which the proposal must accept, the proposal lapses as soon as the time expires.
(c) After expiry of a reasonable time: If no time has been prescribed, the proposal lapses after the expiry of a reasonable time. What is a reasonable time will depend on the circumstances of the case?
(d) By failure of a condition precedent: An offer lapses by the failure of the acceptor to fulfill a condition precedent to acceptance where such a condition has been prescribed.
(e) By death or insanity: An offer lapses by the death or insanity of the proposer if the fact of his death or insanity can to the knowledge of the acceptor before acceptance.