Private Law 1

Question 1

When does a statement become an offer?

Answer 1

When its terms are sufficiently clear to indicate the intention of the offeror to be bound in contract on acceptance by the offeree

Question 2

What case implies the importance of communication in valid contracts?

Answer 2

Philp & Co v Knoblaugh (Letter + Telegram + Plate Linseed)

Question 3

What cases are used to demonstrate the differences between an invitation to treat and an offer?

Answer 3

Fisher v Bell (Flick Knife)

Pharmaceutical Society of Great Britain v Boots

Question 4

What case is used to ensure the terms of contracts are clear?

Answer 4

McArthur v Lawson (Manager of Merchant Business for two years but behaviour issues)

Question 5

What case shows the validity of unilateral binding contracts?

Answer 5

Carlill v Carbolic Smoke Ball Co

Question 6

What are the 3 rules for an offer lapsing?

Answer 6

1. When it is rejected or met by a counter-offer
2. When it is revoked (withdrawn) by the offeror
3. When it is not accepted in time

Question 7

What case shows the effect of a counter offer?

Answer 7

Wolf & Wolf v Forfar Potato Co Ltd (original offer killed by counter offer + no further communication)

Question 8

What case shows an offer which has been lapsed and why?

Answer 8

Wylie & Lochead v McElroy & Sons (Price of iron fluctuates)

There was a 5-week delay involved in accepting the offer which was regarded as an “unreasonable” amount of time.

Question 9

What are the two forms of acceptance in a contract and what can impact these forms?

Answer 9

1. Implied
2. Expressed

The type of acceptance will act in accordance with the terms of the offer.

Question 10

In General, when does acceptance become effective?

Answer 10

The communication of acceptance is essential. The general rule is that acceptance is effective on receipt
It is only effective once they read the fax or email, take the call or listen to the message. Until that point, they can withdraw the offer.

Question 11

What is the postal acceptance rule?

Answer 11

Acceptance is considered effective as soon as the letter of acceptance is posted, regardless of when it is actually received by the offeror.

Revocation of the offer must be received to be effective.

Question 12

What case explains the postal acceptance rule in relation to ineffective withdrawal?

Answer 12

Thomson v James

Letter of revocation and acceptance sent the same day by both parties. Withdrawal needs to be communicated, not enough to simply put it in post.

Question 13

What case explains the postal acceptance rule in relation to effective withdrawal?

Answer 13

Dunlop v Higgins

The letter of an offer was not received for a few days due to postal delays. The offeror then sent another letter revocating this offer as the price of the subject had increased. This withdrawal was valid as an acceptance had not been sent yet.

Question 14

What is a promise?

Answer 14

A unilateral obligation which must be in writing and signed by the person making the promise unless made in the course of business.

Question 15

What are the 5 principles of a promise?

Answer 15

1. Serious intention to be bound
2. Must reach the third stage of:- desire, resolution and engagement
3. Must be communicated
4. Irrevocable once made, but may be rejected
5. Needs no acceptance but may be subject to a condition

Question 16

What case demonstrates a Promise?

Answer 16

Smith v Oliver

Trustees of the Church claimed £7000 in Mrs Oliver’s Will. However, this did not exist and was said to be a verbal agreement (a promise).