Short answer. It automatically became ineffective. Article 1323 provides that an offer becomes ineffective upon the death, civil interdiction, insanity, or insolvency of either party, offeror or offeree, before acceptance is conveyed. Since the offeree was declared insane before accepting, your offer lapsed on its own, without anyone needing to withdraw it.
What the law says
An offer becomes ineffective upon the death, civil interdiction, insanity, or insolvency of either party before acceptance is conveyed.
Civil Code, Article 1323 — When an Offer Becomes Ineffective. Read the full provision →
The rule: certain events make an offer ineffective automatically
Article 1323 lists a specific set of events that end an offer automatically, without any action needed from either side. It states that an offer becomes ineffective upon the death, civil interdiction, insanity, or insolvency of either party before acceptance is conveyed. Rather than leaving the offer open until someone formally withdraws it, the article treats these four events as automatically closing off the possibility of a valid contract forming from that particular offer.
Insanity is expressly listed
Insanity is one of the four events named directly in the article, alongside death, civil interdiction, and insolvency. Where the person to whom the offer was made — the offeree — is declared insane before conveying acceptance, that event falls squarely within what the article describes. There is no need for you to formally revoke the offer or for the offeree's representative to reject it; the ineffectiveness follows automatically from the insanity itself, as the article states it.
Why it applies to either party, not just the offeror
The article applies to either party, meaning it is not limited to something happening to the person who made the offer. The same rule that would end your offer if you yourself were declared insane before the other party accepted applies equally when it is the offeree, the person you made the offer to, who is declared insane first. The identity of which party is affected does not change the outcome under this article.
The timing that matters: before acceptance is conveyed
The critical timing is before acceptance is conveyed. Article 1323 is concerned with what happens during the gap between an offer being made and acceptance actually reaching the offeror; an event like insanity occurring within that window is what triggers ineffectiveness. If acceptance had already been conveyed before the offeree was declared insane, this particular article addressing the offer stage would no longer be the relevant one, since a contract may already have been perfected by then.
Cases citing this provision
These Supreme Court decisions cite the provision above. We list them so you can read them yourself; the summaries of what each decided are not ours to give.
- Belinda Alexander vs. Spouses Jorge and Hilaria Escalona and Reygan Escalona, G.R. No. 256141, July 19, 2022 — read the decision on LawPhil →
- Spouses Romeo Anastacio, Sr. and Norma T. Anastacio vs. Heirs of the Late Spouses, G.R. No. 224572, August 27, 2020 — read the decision on LawPhil →