Formation of a contract: Acceptance Flashcards
What does acceptance confirm?
That the terms of the offer are agreed
Once an offer has been accepted there is a …
Binding contract
What does there have to be alongside acceptance?
Consideration and Intention to create legal relations
What must acceptance be?
Positive and unqualified
Communicated to the person who made the offer
What can acceptance be?
Verbal or written
How is an offer accepted?
Can be in any form, doesn’t have to be in the same method which the offeror used as long as offeror agrees for that method to be used
What is the rule on acceptance?
That the offeror must be aware of acceptance for acceptance to be valid
What is never acceptance?
Silence
Felthouse v Bindley
Facts: Nephew discussed buying horse from uncle, gave price and said if I don’t hear from you I will consider him mine, horse was sold by mistake at auction
Held: No contract, silence is never accepted
How is offer accepted AO3
P - Was the correct decision as it prevents the floodgates opening and frivolous claims overwhelming the courts
DP - It also sets clear predent that makes sense, easier for lay people to understand
WDP - However, it may be difficult for small businesses to communicate acceptance such as Etsy compared to Asos
Mandatory Instructions
Instructions which the courts decide are non-negotiable, it not followed, there’s no contract
Directory Instructions
Instructions which the courts decide are not fundamental, if not followed, there can still be a valid contract
What will electronically signed contracts be applied the same as?
A written signature
What is the issue with telephone conversations?
Difficult to prove what was said
Wells v Devani
Facts: estate agent successful in commission, even though commission wasn’t included in contract, SC agreed the contract wouldn’t make sense without term
Instructions AO3
P - No Parliamentary definition of mandatory and directory instructions, leads to judicial creativity
DP - Conflicts with ROL
WDP - Hpwever, judges can use expert knowledge
When does acceptance take place?
When it’s communicated to the offeror
When offeree states acceptance
Acceptance through conduct
By actions
Carlill v Carbolic Smokeball - accepted through conduct when she accepted the terms and conditions
Reveille Independent v Anotech
Contract drafted by offeror, offeree sent it back with amendments, offeror never signed but there was a binding contract when the offeror fulfilled his part of the agreement
Acceptance through conduct AO3
P - Shouldn’t be binding as it is inconsistent with the rules on silence (Felthouse v Bindley)
DP - If offeror wishes to revoke offer but unaware it’s been accepted, can lead to lengthy litigation
WDP - However, should be binding as they still read it and provided services
Acceptance by post
Acceptance takes place as soon as letter is posted
Must be usual/expected means of communication
Must be properly addressed/stamped
Offeree must be able to prove letter has been posted
Adams v Lindsell
Facts: Delayed letter sent by post, offeror unaware there was acceptance, sold wool to third party
Held: Acceptance took place as soon as letter was posted, no communication of revocation, was a valid contract
Getreid v Contaminar
Facts: Offeree sent letter of acceptance by post, wrong address on front of letter
Held: Postal rule didn’t apply, unreasonable to put offeror at disadvantage as offeree made mistake
Postal rule AO3
P - Unaware it’s been sent out until it’s received, they’re bound for a period of time without being aware
DP - Can’t receive letter and send to someone else, could be liable even though wasn’t malicious
WDP - Upholds public policy as it promotes consistency
Electronic methods of communication
Acceptance occurs when offeror is aware of acceptance
Thomas v BPE Solicitors
Facts: Email sent at 6pm on Friday, office didn’t reopen until tuesday
Held: Acceptance didn’t take palce until office reopened on tuesday
