Acceptance Flashcards
R v CLARKE (1927) 40 CLR 227
The offeree must know of the offer to accept it (Australian case).
The Australian Government had advertised an offer of reward for information leading to the arrest of certain murderers. Clarke saw the offer but subsequently gave the information only when he himself was suspected of the murders. By that time he had forgotten about the offer of a reward.
WILLIAMS V CARWARDINE (1833) 5 C & P 566
The offeree’s motive for accepting is irrelevant.
Williams v Carwardine is another case which involved an offer of reward for information leading to the conviction of a murderer. The claimant knew of the reward, but in fact provided the information because she was dying and wanted to ease her conscience. The court held that this did not preclude a valid acceptance of the offer.
Butler Machine Tool Co Ltd v Ex-Cell-O Corporation (England) Ltd [1979] 1 WLR 401, CA.
Battle of the Forms
The claimant offered to sell machinery to the defendant. Delivery was to be in 10 months time, and the price was £75,000. The claimant sent the offer on its usual standard form. The form said that the claimant’s terms were to prevail over any terms on the defendant’s standard form. The claimant’s terms included a price variation clause which allowed the claimant to increase the price of the machinery to keep pace with inflation. The defendant sent back a form purporting to accept the claimant’s offer. The defendant’s form of acceptance, however, said that the price must be fixed at £75,000. The defendant’s form of acceptance asked the claimant to sign and return a tear-off slip. This slip provided that the terms of the defendant should prevail. The claimant signed and returned the tear-off slip. When the claimant delivered the machinery it tried to invoke the price variation clause in its original offer, and claimed an extra £2,800. The defendant refused to pay and the claimant sued.
The Court found a contract on the defendant’s terms. The claimant made the initial offer. However, it was held that the defendant’s form of acceptance amounted to a counter offer. This had been accepted by the claimant returning the tear-off acknowledgement slip which provided that the terms of the defendant were to prevail. Consequently the defendant was not subject to the price variation clause and did not have to pay the extra £2,800.
(Scammell v Ouston [1941] AC 251 HL).
In the absence of any other details of the hire purchase agreement (eg duration, number and amount of repayments) it is too vague to be a contract
ENTORES LTD v MILES FAR EAST CORP [1955] 2 QB 327
Acceptance must be communicated. The general rule is that acceptance must be communicated and is effective when and where it is received.
The general rule is that acceptance must be communicated (Entores Ltd v Miles Far East Corp [1955] 2 QB 327), and communicated either by the offeree or his duly authorised agent (Powell v Lee (1908) 99 LT 284). (This is in stark contrast to notice of withdrawal of an offer, which if you recall, can be through a reliable third party (Dickinson v Dodds).)
It is possible for the offeror to waive the need for communication of acceptance in certain situations. For example, if there is an offer of a unilateral contract, the offeror is generally taken to have impliedly waived the need for communication. As we saw earlier, a unilateral contract is formed where the offeror makes a promise in return for an act. In this case the performance of the act will amount to acceptance. The case of Carlill v Carbolic Smoke Ball Co [1893] QB 256, CA provides a good example of this.
The Court of Appeal decided that using the smoke ball in the prescribed manner was the act of acceptance and that the company had waived the need for communication.
In Entores Ltd - The claimant was a company based in London and was dealing with the defendant, an American company, through agents in Amsterdam. The claimant telexed the defendant’s agents offering to buy goods. The agents accepted the offer by telex. Later a dispute arose and the claimant wanted to sue the defendant for breach of contract. To do this it was essential to know where the contract had been made: Amsterdam or London? The Court of Appeal held that the parties were effectively in the same position as if they had been in each other’s presence, and accordingly acceptance took place in London where it was received.
FELTOUSE v BINDLEY (1862) CB NS 869
Silence is not an acceptance of an offer.
An uncle offered to buy his nephew’s horse for £30.15s. He said ‘If I hear no more about him I shall consider the horse mine at £30.15s’. The nephew did not reply. He had previously arranged for the horse to be sold by auction, and so now instructed the auctioneer to withdraw the horse from the sale.
The auctioneer, however, sold the horse by mistake and the question before the court was whether there had been a contract between the uncle and the nephew for the sale of the horse. If so, the uncle would be entitled to sue the auctioneer in the tort of conversion (on the basis that he had sold something that rightfully belonged to the uncle). The court held that there was no contract between the uncle and nephew. The court said that the uncle had no right to impose upon his nephew a sale of his horse unless the nephew wrote to him to reject the offer. Although it was clear that the nephew in his own mind intended his uncle to have the horse, he had not communicated this intention to his uncle or done anything to bind himself. For these reasons there was no contract for the sale of the horse.
