Acceptance Cases Flashcards
Is the offeree’s motive for giving the acceptance relevant?
No
Williams v Carwardine
Carwardine don’t care
Gave evidence to ease his conscience not for the reward.
Will two cross-offers form a contract?
No
Tinn v Hoffman
Two ns, two cross offers
Two cross offers (exchange of promises) do not make a contract. Need valid acceptance.
Blackburn LJ: NARROW:Turns on the need for REFLECTION ON the bargain
Honeyman BROAD dissent: thought the parties were ad idem so a contract had formed.
This isn’t sensible. The parties need to have thought about what they’re doing before you can say they’re ad idem. Disagree on this basis.
The acceptance must be a mirror image of the offer. Which case would you use as the authority for this principle?
Hyde v Wrench
Hyde mirrors a wrench
What must the offeree have before acceptance will be deemed valid?
What would you contrast this with?
Knowledge of the bargain.
R v Clarke (also Tinn v Hoffman)
Clarkes’ shoes have the knowledge.
Gave info leading to arrest of criminal, but was unaware of the contract offered, so couldn’t accept it.
Motive is irrelevant, but knowledge of the offer is crucial.
Cf. Chitty’s view: if the existence of the offer plays some small part in inducing the act then there will be valid acceptance.
This is wrong because there is too much to decide between the presence of a motive and the absence of a motive. So subjective, so motive should be entirely irrelevant.
What is the general rule for acceptance in unilateral contracts? 2 cases
Offer may be revoked any time before complete performance
A term will be implied into unilateral contracts: that the offeror will not do anything to prevent the completion of the transaction.
Luxury Darling
Luxor v Cooper
Cinema - act was to introduce a willing purchaser of the cinema. Reward = commission. HoL found for D, the contract wasn’t complete until the sale had gone through
Lord Russel said that implying a term into a contract must be a necessity, terms will not be implied just because it may be reasonable or attractive to do so. Courts will not rewrite the bargain!
Daulia
Here the offeror had completed performance, so the revocation of the offer came too late.
The implied term was implied into this contract too.
Reasoning: Lord Goff: similar reasoning to Bingham in Blackpool v Flyde - it is easy to make a unilateral offer, harder to complete performance, so court is sensitive to this power-imbalance.
What is the exception to the general rule for acceptance of a unilateral contract offer?
Errington v Errington
The offeror may not withdraw the offer once performance has begun by the offeree.
(Here about mortgage instalments)
Note that this exception is not to do with the status of land law within contract, it turns on Denning LJ’s view of where acceptance in unilateral contracts occurs.
The don tract would cease to bind if they left payments unpaid or incomplete (they hadn’t so the position during the father’s lifetime must be maintained)
What dies quantum meruit mean?
Reasonable sum paid for services done when the amount due is not stipulated in a legally enforceable contract.
Can acceptance be done via conduct (in a bilateral contract). If it can, what is this an exception to?
Yes
Brogden v Met Railway
Brogden’s conduct in the railway was abhorrent.
Coal arrangement formalised in draft contract, amended and sent back (counter-offer). Railway placing order was acceptance through conduct.
So acceptance can be via conduct, providing the offeror can be deemed to have waived the communication requirement.
An incomplete negotiation will be overtaken if the parties act as though they had reached agreement. Courts are unwilling to undo bargains.
This is an exception to the communication rule.
Which case was criticised by Prof Atiyah for not setting a limit to the ‘realistic’ view of contract formation?
British Steel v Cleveland Bridge
No limit to reality on Cleveland bridge.
Letter of intent - pls start making components. C did. Negotiations over the main contract broke down, so no contract was formed. Held that there wasn’t a contract, but there was a quantum meruit claim. It couldn’t be a unilateral contract since don’t know whose terms governed it (as negotiations had broken down).
Lord Goff didn’t depart from reality - Said it would be a legal fiction to impose a contract, despite the fact they acted like they had one. Prof Atiyah criticises this, and takes the view that a (collateral contract - my input) contract was formed.
Claim for expenditure, not loss was upheld.
Can acceptance be inferred by silence?
No.
Felthouse v Brindley
Felt houses are really soft and silent.
Horse sold at auction, despite the fact it had already been sold.
If I hear no ore about him, I consider the horse mine
Statute prohibits inertia selling (otherwise people could be bound too easily)
This case actually turned in the statute of frauds, so it isn’t actually the authority on ‘no acceptance by silence)
In which cases did D try to argue that the circumstances were sufficiently special to allow acceptance to be inferred from silence? Were the claims successful?
Leonidas D
Leonidas roar - so special.
They tried to argue that arbitration had been abandoned due to inactivity (acceptance through silence). The offeror was suggesting mutual silence would bind the offeree.
This wasn’t allowed, silence is considered objectively.
Vitol SA v Norelf
Buyers repudiated contract, sellers didn’t respond. This lack of response was deemed to be acceptance of the repudiation. This omission to act was pregnant with meaning in the practical world of businessmen.
What are the 5 cases on silent acceptance?
Felthouse v Brindley Leonidas D Vitol SA Re Selectmove Dresdner Kleinwort
What was Re Selectmove about? Point of law?
Offeree proposed to pay in instalments, inland revenue said they would seek approval from supervisors, nothing more heard, CoA accepted that the inland revenue had accepted through silence.
Peter Gibson LJ said the general rule is no acceptance through silence. However in cases where the offeree suggests it the circumstances will be sufficiently special, and so warrant departure from the rule. The offeree is electing that he will speak up if he doesn’t want the agreement to be concluded.
Note that the claim ultimately failed since no consideration was paid, consideration can’t be found in the part-payment of debt cases.
Which case was about bank’s contract with its employees allowing it to unilaterally alter the terms of the employment contract?
Dresdner Kleinwort v Attrill 2013
Announced in a town hall meeting that they would pay bonuses to them. No individual guarantees given.
CoA held that legal intentions has been intended, the offer bound the bank despite acceptance through silence.
Elias J said the offeror may dispense with notice to himself, here it would be a formal and unnecessary exercise for the employees to have to positively accept the offer. Plus, if 10 employees accepted but the rest didn’t then the £400m would have to go to the 10!
Jill Poole calls this a waiver of the need to communicate acceptance.
So the bank made a unilateral variation in the terms of contract with its employees. Consideration - was it not going to another job?
When the employees accepted the term of their employment contract they accepted the unilateral variance of terms, so the acceptance for the variation stems from this. So long as there is a process whereby the terms may be challenged, the contract stands.
If the offeror chooses to place restrictions on what constitutes acceptance will these restrictions be upheld?
Yes
Eliason v Henshaw
Freedom of contract. Acceptance (of contract for flour) only by writing through return of wagon
Eliason particular over his Hen shawing
