Johnson was in a car accident with Smith. Smith’s insurer, AAA, and Johnson’s attorney exchanged offers and counteroffers to settle Johnson’s negligence claim. AAA eventually agreed to meet all of Johnson’s settlement conditions except her demand to be paid $20/day for the loss of the use of her car. As to that point, AAA proposed to pay $10/day. Johnson rejected the $10/day and filed an action against Smith. Smith contends the matter had been settled. Is Smith correct? Explain your answer.

Stan read an advertisement in the newspaper that said that the jackpot for picking the six winners in the dog race on the last night of the season was $825,000. Stan went that night and correctly picked the winners. However, it turned out that the newspaper had made a mistake. The jackpot was $25,000, not $825,000. Therefore, the track owners refused to pay the latter amount. If this ad is treated like offers of reward, can Stan collect the $825,000? Explain.