Cotract Law Flashcards
What is an offer
A proposal showing a willingness to contract on firm and definite terms
Who is the offeror
The person who makes the offer
Who is the offeree
The person to whom an offer is made
What is an invitation to treat
An indication that one person is willing to negotiate a contract with another but that they are not yet willing to make a legal offer
Describe an offer
Starting point for a contract
Once an offer is communicated offeree can chose to accept it or not
Offer must be definite in its terms
Difficulty is in deciding whether statement amounts to offer or whether it is just a statement
An acceptance of the offer forms the basis of a valid contract
Describe an invitation to treat
Not an offer
Can not be accepted
Gibson v Manchester City council
Is an advert an offer?
Generally no it is only an invitation to treat
Partridge v Crittenden
Unless exceptional circumstances where advert indicates clear ‘offer’ court may decide its an offer
Usually occurs when contract is bilateral
What is a unilateral contract
The offeror makes a promise in exchange for an act by another party
E.g a reward for a missing pet found
No one is under obligation to find the missing pet but there is an offer to pay reward to finder
Unilateral contract only arises when the offeree completely performs the required act
CARLILL V CARBOLIC SMOKE BALL
What is a bilateral contract
There is an exchange of mutual promises
E.g to buy a loaf of bread for £1 both parties have an obligation to provide
One provides bread one provides moneh
Is goods in a shop window/shelf an offer?
Goods on shelf are invitations to treat
Contents of basket becomes offer when customer presents to checkout operator
R v Morris
Shop then accepts or declined customers offer through scanning
Goods in shop window are also an invite
Fisher v Bell
Is an auction an offer
The bidder makes the offer that the auctioneer accepts by banging its hammer.
This means lots available at auctions are invitation to treats
British Car Auctions v Wright
Is a request for information an offer
A request for information and reply to request is not an offer
This may be a general enquiry such as when an item displayed for sale does not have a price in it
Harvey v Facey
Who can make an offer
Anyone
An individual, partnership, limited company.
An offer can also be made through a notice or a machine as in
Thornton v Sloe Lane parking
To whom can an offer be made too
A named individual (Gibson v Manchester City council)
A group of people
The world at large (carlill v carbolic smokeball)
An offer can be targeted at particular individuals and may be conditional on another contract being made
How is an offer communicated
An offer comes into existence when it’s communicated to the offeree.
Communication requires the offeree to know of the existence of the offer
Taylor v Laird
How can an offer end
Revocation
Rejection
Lapse of time
Death
Acceptance
Explain Revocation
An offer can be revoked at any time before acceptance.
The offeror must communicate the revocation to the offeree before the revocation can take effect.
Routledge v Grant
This can have implications where there is an offer to the whole world
Carbolic Smokeball v Carlill
In cases where conduct indicates acceptance, the offer cannot be revoked when the expected conduct continues
Errington v Errington
Explain rejection
Once an offer is rejected - offer ends
If the offer is made to more than one person rejection by one person does not mean the other offerees can no longer accept
Rejection must be communicated to the offeror before it takes effect as in revocation
Offer can be rejected in two ways:
1) specifically responding to the offer by saying ‘no’
2) making a counter offer HYDE v WRENCH
sometimes enquiries during negotiations are treated as requests for info not counter offers
Stevenson v McLean
Explain lapse of time
Offer can end by lapse of time
Fixed period for the duration of the offer is stated - as soon as that expires - no offer to accept
Problem arises when no time is set. In this situation time is a reasonable time which varies depending on nature of the offer
Ramsgate v Victoria Hotel
Explain death (offer)
If the offered dies- offer ends and those dealing with his estate cannot accept on his behalf
Offeror dies - acceptance can still take place until the offeree learns of the death of the offeror
This is not the case where the offer is to perform some personal service
What is acceptance
Acceptance must be positive and unqualified
Must be acceptance of the whole offer and all it’s terms
There is acceptance if the response to the offer is ‘yes’
Acceptance can be seen when you tap ‘I agree’ to accept contract
How do you accept an offer
Acceptance can be in any form provided it’s definite and communicated by the offeror
Email, text, letter
Acceptance can not be silence
Felthouse v Bindley
Offeror can require specific method for acceptance which must be complied with for valid acceptance
Yates v Pulleyn
Requirements of signature can cause problems where negotiations are conducted electronically
Neocleous v Rees
Similar problems when contracts made on telephone as no evidence
Wells v Devani
When does acceptance take place
As in Stevenson v McLean the actual time of revocation of an offer is critical
Equally with acceptance
General rule is acceptance takes place when the acceptance is communicated to the offeror
3 ways of accepting
1) acceptance by conduct
2) acceptance by use of the post
3) electronic methods of communication
What is acceptance by conduct
Seen in Carlill v Carbolic Smokeball
Reflects what occurs quite often in business contracts - the job begins before the formal contract is agreed in all its detail with numerous offers and counter offer
