Offer and Acceptance Flashcards
To constitute acceptance, the offeree must fulfil 3 conditions
- unqualified expression of approval,
- Exactly match the terms of the offer,
- Communicated
What happens when there is a counter offers
alter/add the terms by the offeree, the original offer will be destroyed and the offeror could reject the counter offer or accept it which forms a new agreement.
Hyde v Wrench [1840]
what happens when there is a Requests for information during the offer
Requests for information are not counter-offers or acceptances
Stevenson, Jacques and Co. v McLean [1880]
Who wins in battle of forms?
Last shot rule - the last party to submit their terms and conditions are likely to be the ones that would apply.
Butler Machinetool Co, Ltd v Ex-Cell-O Corporation Ltd [1979]
What happens if the words of acceptance not receive by offerer?
Receipt rule – no contract will be formed unless words of acceptance are clearly heard by the offeror. unless the offerer waived the need for communication, e.g., unilateral contracts.
Entores Lt v Miles Far East Corporation [1955]
what happens if the offeror has no reply to the offeree after he has made his offer?
Silence in Bilateral Contract is not acceptance.
Felthouse v Bindley [1862]
What happens when acceptance letter is put into the post box?
Acceptance is effective immediately that the letter is put into the post box
Adam v Lindsell [1818]
what happen if the acceptance posted in the post box is not received by the offeror
Acceptance is still effective even if the letter of acceptance is not received
Household Fire and Carriage Accident Insurance Co. Ltd v Grant [1879]
Is postal rule always applicable?
Postal rule is applicable only where it was reasonable in all of the circumstances for the offeree to have used the post
Henthorn v Frazer [1892]
Justification for Postal Rule
- Commercial convenient – offerees would know if a contract had been formed.
- Prevent speculation by posting acceptance but withdraw through a speedier mean
- The offeror indicates the use of post and therefore bear the risk of the system
Criticism of Postal Rule
- Operation of such rule is arbitrary, since it does not apply to non-postal acceptances
- Offeror may believe that since no reply received, then the offeree does not wish to be accepted
Does postal rule apply to instantaneous method of communication?
Postal rule does not apply to instantaneous methods of communication, must be resolved to the intention of the parties.
Brinkibon v Stahag [1983]
what happen if send time ≠ received time under non traditional method of communication?
No universal rule, but if offeree done all that he might reasonably expected, acceptance should take effect when the offeree might reasonably expect it to be communicated to the offeror.
The Brimnes [1975]
Are the method of communication for acceptance in a contract binding?
Method of communication for acceptance is a direction rather than a legal requirement unless it is a condition that a stipulated method to be considered
Siemen Hearing Instruments Ltd v Friends Life Ltd [2014]
What happens if the revocation of an offer is carried out before acceptances?
no contract are form if the revocation of an offer is carried out before acceptance
Payne v Cave [1789]
What happens if revocation of offer is unilateral in nature?
if the offer is unilateral in nature, then it is irrevocable after the performance begun
Errington v Errington and Wood [1952]
Does postal rule applies on revocation?
The postal rule does not apply to attempts to withdraw offers. The offeree must actually receive the withdrawal before they have accepted the offer for the offer to be terminated.
Byrnes and Co, v Van Tienhoven and Co. [1880]
what is the legal method of communication for revocation
Method of communication for revocation is irrelevant, provided that the intention was made clear
Dickinson v Dodds [1876]
When does the offer expires if it is not specified?
Where an offer does not specify that it is valid for a given amount of time, it will expire once a reasonable period has passed
Ramsgate Victoria Hotel v Montefiore [1866]
What happens to the offer if one of the party is dead?
Death automatically terminates the offer
Reynolds v Atherton [1921]
Defination of an offer
expression of willingness to contract on the specified terms without further negotiation, so that it requires only acceptance for a binding agreement to be formed.
Invitation to treat is not offer because
lack intention to be bound, or the required certainty and specificity in contractual terms.
How does the wording affects the offer?
the offerer must have the intention to be bound
- Storer v Manchester City Council [1974]
- Gibson v Manchester City Council [1979]
are quotations offer or invitation to treat?
giving price without the intention of selling is not offer.
Harvey v Facey [1893]
Are advert an offer or invitation to treat?
Advert are generally invitation to treat
Partridge v Crittenden [1968]
Exception is where the advert is a unilateral offer
Carlill v Carbolic Smoke Ball Co. [1893]
Are Supermarket Shelves Goods and Window Display offers or invitation to treat?
Supermarket Shelves Goods and Window Display are invitation to treat. Contract of sale are only concluded when the goods were paid for.
Pharmaceutical Society of Great Britain v Boots Cash Chemists [Southern] Ltd [1953]
Fisher v Bell [1961]
are tenders offers or invitation to treat?
Tenders are invitation to gather tenderer to offer and the person requesting the tender has the freedom to determine which to accept.
Spencer v Harding [1870]
what is the nature of the offer where the tender is expressed a contractual promise to accept the most competitive bid
This invitation is a unilateral Contract because promise to accept most competitive tender and therefore submission of tender is an offer.
Harvela Investment Ltd v Royal Trust Co. of Canada Ltd [1986]
are auctions offer or invitation to bid?
General rules are auctioneer, makes an invitation to treat, by requesting bids. Offer is made by the bidder and the offer is accepted when auctioneer strikes the table with hammer.
Harris v Nickerson [1872]
SOGA 1979 s57(2)
what is auction without reserve?
Auction without reserve - promise to sell to highest bidder and not to apply any reserve price or allow the vendor to bid in order to artificially push up the price
define limited stocks argument
if adverts were routinely treated as offers, it would lead to the conclusion that people advertising goods for sale were holding themselves out as being able to supply an unlimited quantity to anyone who saw the advert
