Offer and Acceptance Flashcards
what is an agreement
broadly speaking an agreement is made when one party accepts an offer made by the other party
Consensus ad idem
- ‘if the parties reach accord by means of offer and acceptance and they should be contractually bound’ (this approach can be superficial)
Objective Test
Smith v Hughes
- ‘If whatever a mans real intention may be, he so conducts himself that a reasonable man would believe that he was assenting to the terms proposed by the other party and that other party upon that belief enters into the contract with him, the man thus conducting himself would be equally bound as if he had intended to agree to the other party’s terms’
Smith v Hughes [1871]
- Wanted old oats and got new oats
- Said that he didnt make that clear - old or new just oats.
- Regardless what was in hughes heads, objectively speaking - it does not matter that subjectively they were looking for something - objectively he got his oats so hes legally bound
- courts used an objective approach
What is an offer?
an expression of willingness to contract on specified terms made with the intention that it shall become binding as soon as it ia accepted by the person to whom it is addressed
- Break down into 3 characteristics
1. ust set out terms
2. terms must be sufficiently certain
3. Offer must give an indication that the offeral attends to be bound as soon as his offer is accepted
When is an offer not an offer?
- When it is an ‘invitation to treat’… statements which indicate the makers willingness to receive offers, they are not offers themselves
- Line between offer and invitation determines whether there is any room for further details to be set out
Ex;
Offer: - I will sell you my laptop if you pay £150 by 5pm today
Invitation to treat: - I will sell you my laptop if we can negotiate a good price
Advertisements
Bilateral: Invitation to treat
- partridge v crittenden [1968]
- one promise exchanged for another promise
Unilateral: Offer
- Carlill v Carbolic Smoke Ball Co [1893]
- One promise in exchange for a performance of a requested act
Patridge v Crittenden [1968]
- Charged with unlawfully offering for sale a brabble finch bird - contrary to the protection of birds act
- Action is brought against him - breech
- It is an invitation to treat and therefore had not offered for sale
- If this advert was construed as an offer - and their reply was acceptance - he would be obligated to sell 1000 birds when he only has 3 for sale
Carlill v Carbolic Smoke Ball Co
Arguments raised by the defendant:
1. No intention to create legal relations
2. Bound to contract to the whole world
- It is not a contract made with the whole world. There is the fallacy in the argument. It is an offer made to the whole world and why should not an offer be made to the whole world which is to ripen into a contract with anybody who comes forward and performs the condition
Goods sold in shops
Pharmaceutical Society of Great Britain v Boots Cash Chemists [1953]
- The display of goods in a shop is an invitation to treat not an offer
- Charged with selling a listed drug without the supervision on the pharamicist contrary to the pharmacy and poisons act
- Pharmacist is at cash register desk
- As soon as the customer put it into the basket - the contract was formed and the sale was complete
- Display of goods contracted an offer to sell
- Defendant is not guilty because they of the goods being displayed is an invitation to treat
- The customer presenting to the cashier is an offer to buy
- And the cashier/pharmicist can wither accept or deny the offer
Auctions with reserve
- Bilateral contract governing the sale of the goods; bidders make a series of offers and the auctioneer accepts the highest offer above the reserve price
- More straight forward
- Owner of goods can stipulate an minimum reserved prive
- If bidding doesnt reach that minimum price - it wont be sold and it will be returned
- Accepts highest offer above reserve price
Auctions without a reserve
Bilateral contract governing the sale of the goods; bidders make a series of offers and the auctioneer accepts the highest offer
Collateral unilateral contract - auctioneer promises that the
- If advertising an auction without reserve and dont accept the offer or let the owner raise the price
- Barry v Davis
Payne v Cave (1789)
Sale of Goods Act 1979 section 57 (2): ‘A sale by auction is complete when the auctioneer announces its completion by the fall of the hammer, or in other customary manner; and until the announcement is made any bidder may retract his bid’
Barry v Davis [2000]
- Barry only bidder
- Auctioneer said his bid was too low
- Promised that the auction was without reserved
- Entitled to damages not entitled to the product itself
- Entitled to the value of the goods that he lost out on as a result of the goods he lost out on
- Couldnt get the goods because the first contract was not complete
- But the auctioneer breeched the contract so therefore..
Tenders
- tender is an invitation to treat
- Spencer v Harding
- But depends on the wording of the tender: Harvella Investments Ltd v Royal Trust Company of Canada [1984]
Automatic Machines
- Thorton v Shoe Lane Parking [1971]
- National Car Parks Ltd v Revenue and Customs [2019]
Thorton v Shoe Lane Parking [1971]
National Car Parks Ltd v Revenue and Customs [2019]
Contracting Online
When we put our card details in that is our offer to buy
E Commerce Regulations
- Art 11 states that the provider ‘shall acknowledge receipt of the order to the recipient… without undue delay… by electronic means…’
- Formation:
1. Display of goods online - Invitation To Treat
2. Offer to buy - put in card details
3. Confirmation email - notice to the buyer that you have made an offer
4. Acceptance - Acceptance occurs when goods are shipped or are actually received by you as a buyer
Consumer Contract
- Covers online contracts (as well as on-premises contracts and other distant contracts)
- Schedule 1 and 2 - information the trader must provide
- Part 3 - Right to cancel (cooling off period)
–> Formation:
1. Offer
2. Acceptance
3. Right to cancel - Period of time after the agreement where you can get out of the contract ‘cancel it’
What is the definition of an acceptance
A final and unqualified expression of assent to the terms of an offer
Acceptance process
- Acceptance must correspond with the terms of the offer
- Unqualified and must match the terms - Acceptance must be communicated to the offeror
- Special rules apply in the context of unilateral contracts
- Acceptance must correspond with the terms of the offer
counter-offer: A counter offer will bring the original offer to an end - thus making it incapable of acceptance
- Hyde v Wrench
request for further information: will not affect the status of the original offer
- Stevenson Jacques and Co v McClean (1880)
