Offer - Contract Law

Question 1

Bilateral Contract

Answer 1

An agreement between two parties whereby there is an exchange of mutual promise.

Question 2

Unilateral Contract

Answer 2

The offeror makes a promise in exchange for an act by another party.

Question 3

What is an offer?

Answer 3

A statement of intent to be legally bound by the terms of the offer if it is accepted.

Question 4

Who is the offeror and offeree?

Answer 4

Offeror: person making offer
Offeree: person receiving offer

Question 5

What is an invitation to treat?

Answer 5

Indication of a willingness to start negotiations and it invites the other person to make an offer, which can then be accepted or rejected.

Question 6

Partridge V Crittenden

Answer 6

An advertisement is an invitation to treat. Crittenden had not offered the birds for sale.

Question 7

Carlill V Carbolic Smoke Ball Co

Answer 7

An advertisement containing a promise is an offer. This was a unilateral offer as her compliance with the terms had turned it from an offer to the whole world to contract with her personally.

Question 8

Fisher V Bell

Answer 8

Goods in a shop window are an invitation to treat. He was not offering the knife for sale.

Question 9

Pharmaceutical Society of GB V Boots Cash Chemists

Answer 9

Goods on a shelf in a shop are an invitation to treat. A customer takes the goods to the till and makes an offer to purchase.

Question 10

British Car Auctions V Wright

Answer 10

Goods at auction are an invite on to treat as auctioneer is inviting bids. Bids made are offers and these are accepted/rejected by auctioneer.

Question 11

Harvey V Facey

Answer 11

Requests for information/Replies to requests for information are an invitation to treat.

Question 12

Thornton V Shoe Lane Parking

Answer 12

Tickets from an automated ticket machine are an offer.

Question 13

What are the three rules to an offer?

Answer 13

1: Terms of the offer must be certain
2: The offer must be communicated to offeree
3: The offer must not have been terminated

Question 14

What is meant by terms of the offer must be certain (rule 1)?

Answer 14

Specific in its terms and vague words indicate uncertainty on part of the offeror so would amount to an invitation to treat rather than offer.

Question 15

Gibson V Manchester City Council

Answer 15

Words such as “might be prepared” are not an offer.

Question 16

What is meant by the offer must be communicated to offeree (rule 2)?

Answer 16

If the offeree doesn’t know about the offer, they cannot accept it.

Question 17

Taylor V Laird

Answer 17

An offer comes into existence when it is communicated to the offeree. Communication requires the offeree to know of the existence of the offer.

Question 18

Stevenson V McLean (Rule 2)

Answer 18

Exact timing can be critical. It was decided that the query about credit did not end the offer, so a binding contract was made.

Question 19

What are the 5 key factors when discussing termination of an offer (rule 3)?

Answer 19

Revocation
Counter offer
Death
Rejection
Lapse of time

Question 20

What is revocation?

Answer 20

If you ‘revoke’ something it means you ‘take it back’. So if you revoke your offer, you take the offer back.

Question 21

Three rules under revocation?

Answer 21

Must either be before acceptance, communicated or a third party can revoke.

Question 22

Routledge V Grant

Answer 22

An offer can be revoked any time before it has been accepted.

Question 23

In terms of revocation, what is meant by communicated?

Answer 23

The offeror must communicate the withdrawal of the offer to the offeree.

Question 24

Dickinson V Dodds

Answer 24

A reliable third party could notify the offeree of the revocation of an offer.

Question 25

What happens to an offer if the offeree dies?

Answer 25

The offer automatically ends and cannot be accepted on their behalf.

Question 26

What happens to an offer if the offeror dies?

Answer 26

If offeree doesn’t know of the death and has accepted, then the offeror’s estate or representatives may still be bound by the contract.

Question 27

What is an exception to death when terminating an offer?

Answer 27

Where the contract requires the personal service of the offeror. (E.g. a contract for the offeror to provide personal tuition).

Question 28

What is meant by rejection when terminating an offer?

Answer 28

An offer ends once it has been rejected by offered. The rejection must be communicated to offeror for it to be effective. If offer is made to multiple people, others are still free to accept offer.

Question 29

In terms of counter offers, what else do these come under for terminating an offer?

Answer 29

Rejection

Question 30

Hyde V Wrench

Answer 30

Hyde’s counter offer had extinguished Wrench’s original offer. He did not have to sell.

Question 31

What is a counter-offer in terms of terminating an offer?

Answer 31

If offeree replies to an offer with a counter offer changing elements of the original offer, such as suggesting a different delivery date - original offer ends.

Question 32

Stevenson V McLean (Rule 3)

Answer 32

The query about credit was only a request for information and not a counter-offer. The offer therefore remained open and had been accepted.

Question 33

What is meant by lapse of time when terminating an offer?

Answer 33

When there is no specified time for when an offer is ending, the courts say that a “reasonable time” is enough for an offer to lapse.

Question 34

Ramsgate Victoria Hotel V Montefiore

Answer 34

The long delay meant the offer made by Montefiore had lapsed, as a reasonable time had passed. It could not be accepted.