Contract Law Flashcards
What is a Unilateral offer?
an offer which prescribes an act which when performed constitutes acceptance. (Carlill v Carbolic Smoke Ball)
An advertisement amounted to an offer to the world which could be accepted by anyone who performed the conditions set out in it. The claimant did not have to notify the advertiser of her intention to accept the offer prior to her performance of the conditions. Which case does this concern?
Carlill v Smoke ball Co
Did the words, ‘ may be prepared to sell’ in the case of Gibson v MCC constitute a clear and certain offer?
No. It was an Invitation to treat. It is important to consider the language and context when considering whether an offer was clear or certain. (Lord Diplock)
In Storer v MCC, the council said “ if you will sign the agreement and return it to me I will send you the agreement signed on behalf of the corporation in exchange.” The price was also stated. Did this constitute a clear and certain valid offer?
Yes. The council had made an offer to mr storer and terms of that offer were clear and certain. Language and context were clear and certain.
What was the ratio of the Taylor v Laird case?
It was an uncommunicated intention to offer to sell a car. This did not constitute a valid offer because a valid offer must be communicated to the offeree!
What is the general rule that was established by the Fisher v Bell case?
A display of goods is an invitation to treat. Lord Parker CJ stated that “ it is perfectly clear that according to the ordinary law of contract the display of an article with a price on it in a shop window is merely an ITT.”
In Pharmaceutical Society of GB v Boots Cash chemists what was the ratio?
A display of goods Is simple an ITT, not an offer to sell. the picking of a medicine bottle from a shelf is an offer from a customer but the acceptance and sale take place at the till under the supervision of a pharmacist.
What is e general rule of advertisements, elicited by the Partridge v Crittenden case?
Advertisements are ITT. The advertisement “offer for sale” of birds was an ITT and not a valid offer.
What did Lord Parker CJ in Partridge v Crittenden consider as an exception to the rule regarding advertisements.
If the seller is the manufacturer, arguably an ad may constitute an offer as they can satisfy all orders. If the seller is not a manufacturer then the seller would be bound to satisfy all orders even when stock is limited, therefore being in breach of contract for orders that he could not fulfil.
Which case established that an ad may constitute an offer where it prescribes an act which when performed would constitute an acceptance, in other words a unilateral offer?
Carlill v Carbolic Smoke Ball. Remember that for ads to constitute a unilateral offer there must also be a sufficient intention to be bound. In carlill, such an intention was evidenced by the deposit of £1000 into a bank account.
Which case established that an invitation to tender is an invitation to treat as a general rule?
Spencer and others v Harding and the others. In this case the defendants were not obliged to sell to the plaintiffs since the defendants invitation to submit tenders was simply an invitation to treat. The plaintiffs made an offer when they submitted to the highest tender but since this was not accepted there could be no binding contract.
What exception was introduced regarding the general rule of invitations to tender and which case confirmed the rule?
If the inviter had stated that they wold accept the highest bid, then the inviter would be bound to sell to the highest bidder. The case was Harvela Investments Ltd v Royal Trust Company of Canada Ltd. In this case it was adjudged that there was an obligation of the vendors to sell the shares to the buyer whose offer was the higher.
What were the material facts of Blackpool & fylde Aero Club v Blackpool Borough Council and the subsequent ratio decidendi?
It was held that the council had made an offer to consider all conforming tenders because (I) the invitation was made to a specified no. Of parties and (ii) there Are specific and absolute conditions governing the manner of and timing for the submission of tenders. There were 7 parties invited to tender and the local authority’s invitation prescribes clear, orderly and familiar procedure ( draft contract conditions available for inspection, a prescribed common form of tender, the supply of envelopes designed to preserve the absolute anonymity of tenderers and clearly to identify the tender in question and an absolute deadline.) in this circumstance there will be a contractual obligation on the person inviting tenders to consider such tenders that are submitted in accordance with prescribed method.
What was the a ratio in Payne v Cave?
The defendant made a bid of 40£ for y but when the auctioneer delayed in accepting his bid, he declared that he would not buy y and refused to pay. The defendant was entitled to withdraw his bid for y because his bid is simply an offer which he entitled to withdraw any time before acceptance. ( fall of hammer). The general rule is that auctioneer requesting bids, these requests are mere invitations to treat. In other words the offeror can revoke his offer any time prior to it being accepted.
Which case established the exception to the auctions general rule and what was the ratio?
Barry v Davies and Warlow v Harrison. This case adjudged that an auction that is held ‘without reserve’ (without a reserve price) meaning that the auctioneer is in effect undertaking to sell the lot in question to the highest bidder. Therefore in auctions without reserve, the auctioneer is obliged contractually to sell to the highest bidder even if it falls short of the desired price.
How can an offer be terminated?
1 of 3 ways. By rejection, so the offeree rejects the offer, by revocation, meaning the offeror withdraws the offer and by lapse. Once an offer has been terminated in one of these ways, it can no longer be accepted.
Which legal rule would you apply to demonstrate that a counter offer operates as a rejection of the original offer?
Hyde v Wrench. The effect of a CO is that is rejects the original offer and extinguishes it (not capable of resurrection) so an offer of £10 and CO of £8 kills and extinguishes the offer of £10. £8 is the new offer that is rejected. If the original offeree proposes to accept the original offer of £10 it is not binding on the original of offeror, because it is a new offer that requires acceptance from original offeror.
What was the ratio of Stevenson, Jacques & Co v McLean?
The request for further information “please wire whether you would accept forty for delivery over two months, or if not the longest limit you wold give,” did not kill off the original offer of 40s for the item in question. The original offer did not affect original offer and therefore only required acceptance on the part of offeree. The offeror is contractually bound by the acceptance of the offeree.
What is an option?
When a party makes an offer, he may agree to keep it open for a specified period of time. That promise by the offeror to keep the offer open can be a separate contract that is itself enforceable by the offeree, this is referred to as an option contract or option.
Which case established the legal rule that if no consideration had been provided to keep an offer open, then no contract had been created and the offeror could withdraw his contract as he wished without any consequences?
Dickinson v Dodds. A promise unsupported by consideration is not enforceable. There was no consideration by Mr Dickinson of Mr.Dodds notice to leave the offer open up until a specified date, there no option contract would have been created.
Which legal rule established that revocation of an offer is only effective on communication?
Byrne & Co v Leon Van Tienhoven & Co. The revocation was communicated after the acceptance of the offer, therefore there was still a binding contract of the respective parties.
Which legal rule is the authority for the principle that an offer can be revoked by a 3rd party communicating that information to the offeree?
Dickinson v Dodds
What was the orbiter dictum from the Dickinson v Dodds?
Treitel criticised the rule that communication of revocation need not come from the offeror. There can be a regrettable source of uncertainty . It puts on the offeree the possibly difficult task of deciding whether his source of information is reliable. (3rd party unreliability).
Which legal authority established that revocation of unilateral offers could only suffice at any time before performance of the prescribed act has commenced?
Warrington v Errington and Woods. In this case there was a unilateral offer ‘ the house’ and the prescribed act ‘continuance of mortgages payments,’ the daughter in law continued to make mortgage payments even after death of offeror so it was decided that the widow could not revoke the unilateral offer. However completion of the specific performance is needed for acceptance!
What precedent did the Boulton v Jones case establish?
An offer can only be accepted by the offeree being the person to whom the offer is made. The offer from Jones was made to Brocklehurst and it was not open to Boulton to accept it.
Which authority established that an acceptance cannot be made in ignorance of an offer and outline the case.
Williams v Carwardine. The motive for acceptance is not important, in this case the motive was not the reward of £20. This can hav undesirable consequences. A person who is a good citizen by providing information but is not aware of the offer of a reward, will not be able to claim it. But someone solely motivated by financial gain will be able to claim it.
What is the ratio for the case Paul Felthouse v Bindley?
The offeror cannot make an offer ‘if I hear no more about him, I consider the horse is mine at 30l.15s’ and within that offer impose a positive obligation on the offeree to reject that offer (to communicate rejection).
Which authority established the principle that 3rd parties can accept an offer on behalf of the offeree, provided that they are authorised by the offeree to do so?
Powell v Lee. In this case the 3rd party did not have the offeree’s authority to accept. The committee member who communicated acceptance of plaintiffs offer to be headmaster of the school was not authorised by the offeree (committee of managers) and consequently his communication could not constitute acceptance by a 3rd party.
Which authority states that acceptance of a unilateral offer does not have to be communicate that he is going to perform the act?
Carlill v Carbonic Smoke Ball. It was held that the offeree does bot need to communicate his intention to act, simply using the smoke ball as prescribed and catching influenza was sufficient to accept the offer. Remember a unilateral offer is an offer which prescribes an act which, when performed will constitute acceptance.
Which authority established the postal rule?
Adams and others v Lindsell and Another. The postal rule provides that where post is deemed to be the proper method of acceptance, acceptance is deemed to take effect from the moment of proper posting.
Which authority ensures that the postal rule only applies to acceptance only and not to the revocation of an offer?
Byrne & Co v Leon Van Tienhoven & Co. In this case it was established that a revocation is only effective when it is actually communicated.
Which authority established that the postal rule still operates when letters are delayed or indeed never arrive at their destination (lost or destroyed)?
Household Fire and Carriage Accident Insurance Company v Grant. In this case the letter of acceptance was never received by the offeror as it was lost. It was held that the acceptance of the defendants offer to purchase shares was valid from the time of proper posting, despite never reaching the defendant. The offeror does not know that the offeree has accepted but is nevertheless bound by that acceptance even though it is lost or destroyed.
Rule: ‘Where the circumstances are such that it must have been within the contemplation of the parties that, according to the ordinary usages of mankind, the post might be used as a means of communicating the acceptance of an offer, the acceptance is complete as soon as it is posted.’ Which case established this rule?
Henthorn v Fraser. In this case it was deemed that the acceptance of such offer by letter through the post is expressly or impliedly authorised. An authority to accept by post must be implied. Since the plaintiff resided in another town from the defendants, it would have been in the contemplation of the parties that the post would have been used. Consequently the postal rule applied and the plaintiffs acceptance was valid from the moment of posting.
Which authority established that if a counter offer was sent by telegraph, it implied a condition that prompt acceptance was required and accordingly the postal rule did not apply?
Quenerduaine v Cole. The acceptance of an offer by post is ‘not expressly or impliedly authorised.’(Dunlop v Higgins). Prompt acceptance was impliedly authorised by the offeror.
