Offer and acceptance

What is an offer?

A proposal showing a willingness to contract on firm and definite terms

What are the two rules for offers?

• Offers must be definite - they are legally binding

• Offers must be certain - they must be clear

Why is an invitation to treat not an offer?

Since it is not definite

Why was the claim against D in Partridge v Crittenden not successful?

The advertisement for the birds were an invitation to treat

What is a bilateral contract?

Where one party makes an offer to another known party who must communicate their acceptance

What is a unilateral contract?

A firm offer is made to a specified person but the offeree does not need to accept, but if they perform the act required by the contract then a contract exists

What was said about unilateral contracts in Carlill v Carbolic Smoke Ball Co?

Since C had used the smoke ball and still had the flu, they were awarded the promised £100

Why was it deemed that there was an invitation to treat in Fisher v Bell?

Since the good was only displayed in a shop window

What was said about lots at an auction in British Car Auctions v Wright?

Lots at an auction are treated as only as an invitation to treat

What was said about a request for information in Harvey v Facey?

The states £900 was only an answer to a question and only deemed an invitation to treat

When does an offer come into existence under Taylor v Laird?

Only when the offer is communicated to the offeree - the new ship owner had no communication of the offer for Taylor’s wages

When does an offer end?

Where there is:

Revocation

Rejection/counter-offer

Lapse of time

What is revocation?

Where the offeror can withdraw the offer

What does Routledge v Grant say about revocation?

Withdrawing an offer is okay to do

Can revocation be done if communicated by a third party?

Only if the third party is reliable

What does Dickinson v Dodd say about revocation?

Revocation can be done by a third party as long as they are reliable and well-known to both parties

What is rejection?

When the offeree says no to the offeror’s offer - this is done by saying no or making a counter offer

What does Hyde v Wrench say about rejection?

Initial offer of £1000. Countered with £950. Reconsideration of the first offer (£1000) - this was refused

By counter-offering, C had ended the original offer and could no longer be accepted

When will an offer end due to lapse of time?

When a time is specified or the time is a reasonable time for what is offered

What does Ramsgate Hotel v Montefiore say about lapse of time?

D offered to buy shares in hotel in June. In November, the offer was accepted but D refused to pay since the price of the shares had fallen.

The 5-month period between the offer and the acceptance meant that the offer had lapsed and could not be accepted

What is acceptance?

An unqualified acceptance of all terms, it must be a mirror image of the offer

What does an acceptance do to an offer?

Ends the offer and now a contract exists - offeree can’t change their mind and reject or renegotiate the offer

What are the 2 general rules on acceptance?

1. Acceptance must be unqualified - all terms must be accepted - no ifs or buts

2. Acceptance must be communicated to the offeror - this can’t be done through silence

What does Felthouse v Bindley say on acceptance?

Silence can’t be acceptance - “If I hear no more, I consider the horse mine”

What would happen if the offeror required a particular method of acceptance?

This particular method must be complied with

What is the postal rule and what precedent applies?

Acceptance by post takes place as soon as the letter is posted

Set out in Adams v Lindsell

What 3 rules are required for the postal rule?

1. Applies if post is the expected means of communcation

2. The letter must be properly addressed and stamped

3. Offeree must be able to prove the letter was posted

What does Article 11 of the E-Commerce Regulations state?

Postal rule does not apply - the contract is made when the buyer has received an acknowledgement of the acceptance - i.e. an electronic receipt

What is the difference between the cases of Brinkibon and Thoms v BPE Solicitors on electronic acceptance?

Brinkibon - acceptance occurred as soon as business opened

Thomas - it was deemed reasonable for the email to be read at 6pm despite it not being business hours