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Law (paper 3) > Offer and acceptance > Flashcards

Offer and acceptance Flashcards

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1
Q

What is a contract?

A

A contract is a voluntary agreement between two individuals that will be enforced by the law.

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2
Q

What are the four elements which make a valid contract?

A
  1. Offer- Usually what the contract is about, the action that will take place.
  2. Acceptance- When the other party agrees to the offer, the offer and acceptance make up the agreement.
  3. Consideration- The exchange of wealth.
  4. Legal intent- Both must have intention to sue if the contract is broken.
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3
Q

What are the two types of contract?

A
  1. Bilateral- Both parties promise something (AKA specific contract)
  2. Unilateral- There is only a promise made by one person other one usually performs some sort of act.
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4
Q

Who is the offerer?

A

The person who makes the offer to the other.

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5
Q

Who is the offeree?

A

The person who the offer is made to, they chose whether to accept or reject.

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6
Q

What is an invitation to treat?

A

A willingness to enter into negotiation, they’re inviting someone to make an offer.
Statement made preparatory to an offer.

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7
Q

What are self service displays?

A

E.g. A supermarket display, these are always invitation to treat.

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8
Q

What happened in Pharmaceutical society V Boots cash chemist?

A

Established that all self service displays are invitation to treat. The customer offers to buy the product and then the cashier choses whether or not to sell.

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9
Q

What are good displayed in a shop window?

A

These are always invitation to treat.

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10
Q

What happened in Fisher V Bell?

A

Selling flick knives is illegal but they decided that an advert for one in a shop window is not as it was only an invitation to treat.
Not guilty even though intention was to sell.

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11
Q

What must wording be?

A

The offer must be communicated in definitive terms. Words such as ‘may’ does not constitute an offer.

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12
Q

What happened in Partridge V Crittenden?

A

Trying to sell wild birds, which is illegal.

Decided that all adverts are invitations to treat as the offer is made by the potential buyer.

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13
Q

How does an advert become an offer?

A

They become offers if there is a reward attached and a person performs.

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14
Q

What happened in Carlill V Carbolic smoke ball?

A

Offered a reward for someone who used the product and still got ill.
She performed and still got ill, she won the case as it was a unilateral offer to the ‘whole world’.

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15
Q

What was established in Payne V Cave about auctions?

A
  • The catalogue, the ‘lot’ and the bids by auctioneer are all I2T.
  • The bid is the offer.
  • The fall of the hammer is acceptance.
  • The contract is made when the hammer falls.
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16
Q

What are the rules of communication?

A

An offer cannot be accepted unless the person who is accepting knows it exists. Must be communicated.

17
Q

What are the ways an offer can end?

A
  • Lapse of time. (Ramsgate V Victoria hotel)
  • Revocation (Routledge V Grant)
  • Rejection (Stevenson V Mclean)
  • Counter offer
  • Death
18
Q

What is a lapse of time?

A

May have an expiry date where it will cease to exist after this time If no specified date will lapse after reasonable time.
Ramsgate V victoria hotel:
- Offer lapsed as an excessive amount of time had passed before they accepted.

19
Q

What is revocation?

A

The person who makes the offer can revoke it any time but they must give notification to the other party.
Routledge V Grant:
- Offer was revoked after 3 weeks but tried to accept after this. Court held it had ended as was communicated.

20
Q

What is rejection?

A

Once it has been rejected they do not get a second chance, it can no loner be accepted. Failure to reply does not mean rejection.
Stevenson V Mclean:
- Asked if it could be delivered in two weeks, was an inquiry the offer was still open.

21
Q

What is a counter offer?

A

This rejects the old offer and creates a new one. Once it has been made the old offer no longer exists and cannot be accepted.

22
Q

How does death end an offer?

A
  1. If offeree dies it automatically ends.

2. If the offeror dies and the offeree does not know of the death after acceptance the offer is still bound.

23
Q

What is acceptance?

A

The agreement to the terms of the offer. All parties must know of the acceptance. The acceptance must be positive and unqualified.

24
Q

How can acceptance be communicated?

A
  1. Verbally
  2. Conduct
  3. Posted
  4. Electronically
  5. Telex machines
25
Q

What needs to happen for verbal acceptance?

A

Can only be established a long as acceptance is clear and heard.
If the offerer does not hear the acceptance, there is no contract.

26
Q

How does conduct form a contract?

A

Once one party starts conduct there is acceptance even if the contract has not been signed.
Reveille V Independent LLC.

27
Q

What does it mean if there is mandatory instruction on how to accept the contract?

A

If the offer includes instruction on how the acceptance should be communicated, there will only be acceptance once this method is used. Nothing else will suffice.

28
Q

Can silence be accepted?

A

Silence cannot be accepted and some form of action is necessary. In Felthouse V Bindley he stated if he didn’t get a reply that he would assume it had been accepted. Courts decided this wasn’t enough.

29
Q

What is the postal rule?

A

A) Only applies to letters of acceptance and not offers.
B) Only applies if the post is the usual method of communication.
C) Acceptance take place when the letter is posted not when its delivered.
D) Offeree must be able to prove its been posted.

30
Q

What happened in Adams V Lindsell?

A

Acceptance letter was delayed in the post, offerer thought he didn’t want the goods anymore.
As soon as it was posted the contract was formed.

31
Q

What did the courts decide for emails, texts and phone calls?

A

Postal rule had to develop to keep up with technology. They decided that acceptance takes place the moment the offeree presses send.

Law (paper 3) (17 decks)

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