Offer and Acceptance

Question 1

What is the definition of an offer?

Answer 1

It is the starting point of a contract, it is a statement made by the offeror of the terms of the offer to the offeree.

Question 2

Who can make an offer and what must the offer be?

Answer 2

An offer can be made by anyone including individuals and businesses.

Gibson v Manchester Council - An offer must be definitive in its terms. Phrases such as might be prepared to do not amount to an offer.

Question 3

What are the two types of offer?

Answer 3

Bilateral - Promise made by both parties.
Unilateral - Obligation only on the offeror.

Question 4

What is an invitation to treat?

Answer 4

The law works to differentiate the two, An invitation to treat is an indication that one person is willing to negotiate a contract but not make a legal offer.

Question 5

Invitation to Treat: Advertisement?

Answer 5

Partridge v Crittenden, Generally an advertisement is not an offer it is an invitation to treat.

Exception - Carlill v Carbolic Smoke Ball - There is an exception in unilateral contracts.

Question 6

Invitation to Treat: Shop Window?

Answer 6

Fisher v Bell - Goods in a shop window or shelf is an invitation to treat.

Question 7

Invitation to Treat: Lots at an auction?

Answer 7

British Car Auctions v Wright - Lots at an auction are an invitation to treat. The bidder has to make a bid which the auctioneer accepts.

Question 8

Invitation to Treat: Request for Information?

Answer 8

Harvey v Facey - A request for Information is an invitation to treat not an offer.

Question 9

Length of an Offer?

Answer 9

Stevenson v MacLean - An offer can only be accepted whilst it is open, an offer comes into existence when it is communicated by the offeree.

Question 10

Ending an offer - Revocation: Communicated?

Answer 10

Byrne v Van Tiehoven - Must be properly communicated to the offeree and cannot be withdrawn without warning.

Question 11

Ending an offer - Revocation: Any time?

Answer 11

Routledge v Grant - An offer can be revoked by the offeror any time before acceptance.

Question 12

Ending an offer - Revocation: Third Party?

Answer 12

Dickinson v Dodds - The Revocation can come from the offeror or a reliable third party, there is not definition for reliable party.

Question 13

Ending an offer - Rejection?

Answer 13

Hyde v Wrench - Once an offer is rejected it cannot be accepted by the person wanting to accept the offer, the rejection ends the offer.

A counter offer also ends the original offer.

Question 14

Ending an offer - Lapse in Time?

Answer 14

Ramsgate v Montefoire - If a fixed period of duration is stated the offer will end after this time, if there is not a fixed period the courts will decide upon a reasonable time.

Question 15

What are the two other methods of ending an offer?

Answer 15

Death and Acceptance.

Question 16

Acceptance Definition?

Answer 16

Acceptance must be positive and accept the whole offer, it can be accepted in any format.

In order to accept the offeree must:
1) Mirror the Offer.
2) Not change the terms of the offer.
3) Be communicated properly back to the offeror.

Felthouse v Bindley - Silence is not a format of acceptance.

Question 17

Acceptance by Conduct?

Answer 17

Carlill v Carbolic Smoke Ball - Once the conduct required in the offer is done then the contract has been accepted.

Question 18

Acceptance by Post: Rules?

Answer 18

Adams v Lindsel - As soon as a letter is in the post box then this amounts to the acceptance of the offer.

Question 19

Acceptance by Post: Not delivered?

Answer 19

Household Insurance v Grant - If the letter is lost an never delivered this does not effect the validity of acceptance.

Question 20

Acceptance by Post - Exceptions: Normal?

Answer 20

Henthorn v Fraser - The Postal rule only takes effect where it would be the normal way of working between the parties.

Question 21

Acceptance by Post - Exceptions: Excluded?

Answer 21

Holwell Securities v Hughes - That it will not take effect if it has been excluded by the parties.

Question 22

Acceptance by Post - Exceptions: Mistake in Posting?

Answer 22

Getreid v Contimar - It will not take place when there is a mistake in posting, it is the fault of the offeree.

Question 23

Electronic Methods of Communication: Aware?

Answer 23

Lord Denning in Entores v Miles Far East - Held that acceptance only happens when offeror is aware of acceptance.

Question 24

Electronic Methods of Communication: Out of hours?

Answer 24

Brinkibon v Stahag - Out of hours communication from the offeree are only accepted once the offer is reopened. Courts adopted sound business practice rule.

Question 25

Electronic Methods of Communication: Notice of Acceptance?

Answer 25

Article 11 of the Electronic Commerce Regulations 2002 - Acceptance only happens when the buyer has received notice from the seller/provider of acceptance.