contract

Rulers and theory

4 basic ingredients of contract are

key terms

offer - an expression of willingness to enter a contract on certain terms

offeror - the person making an offer to another

bilateral contract - a mutual agreement between two parties where both promise to perform specific obligations.

unilateral contract - a contract in which only one party makes a promise or undertakes a performance, while the other party is not obligated to act unless they choose to do so.

Offer

an offer is an expression of williingness to enter a contract on certain terms. if accepted an offer can become a contract

biggs 1971 : defined an offer as a clear and definite proposal made by one party to another, which creates the power of acceptance in the offeree.

(the offer must be definite in its terms gibson)

invitation of treat

an invitation to treat is an indication of willingness to negotiate. it may encourage others to make offers. and cannot be accepted as it is not an offer.

to decide whether a statement is an offer or ITT is to consider the language used and the context in which it was made, as well as the intentions of the parties involved.

categories of ITT :

1)goods in a shop window or on a shelf (fisher: flick knife on display which was deemed an invitation to treat, as it was not an offer to sell the knife at the displayed price.)

2) Advertisements and brochures( partridge: a case where an advertisement for the sale of birds was held to be an invitation to treat, rather than an offer, since it did not bind the advertiser to sell any specific quantity at the stated price.)

3)Auctions (british car auctions: In British Car Auctions, it was determined that the auctioneer's call for bids constitutes an invitation to treat, meaning that each bid represents an offer that the auctioneer may accept or reject. )

4)a request for infomation(In Harvey v. Facey, it was established that a mere request for information does not constitute an offer, as the communication from the seller was only a response to an inquiry without any intention to create a binding agreement. )

who can make an offer?

an offer can be made by anyone, an individual, business or other organisations. and can also be made by a notice or a machine (thornton v. Shoe Lane Parking Ltd, where the court held that a machine can make an offer when it provides terms that are clear and unequivocal, leading the user to believe that acceptance of those terms will result in a binding contract. )

Making an offer

an offer come to existence when it is communicated to the offeree ( Inland revenue commision v. Fry, where the court emphasized that the offeree must be made aware of the offer for it to be valid). This communication can occur through various means such as verbal conversations, written documents, or digital messages.

Ending an offer

an offer can only be accepted while it is open. once an offer has ended it cannot be accepted and cannot form the basis of a contract this is called termination.

an offer can come to end in the following way:

revocation: the offeror withdraws the offer before it has been accepted. the offeror must communicate the revocation to the offeree before it is effective( routledge the offeree must be made aware of the revocation for it to take effect, and any attempts to accept the offer after this communication will be invalid. the offer must come from a reliable source( it does not have to be the offeror (dickinson))

rejection: once a offer is rejected it cannot be accepted again. the rejection must be communicated to the offeror before it is effective. A counter offer is treated as a rejection( hyde: an offer made in response to another offer that changes the terms of the original offer, thus terminating the initial offer. The original offeror is then free to accept or reject the counter offer.) a mere enquiry will not be treated as a counter offer(stevenson v mclean)

lapse of time: occurs when an offer is not accepted within a specified time frame, or if no time frame is stated, after a reasonable period has elapsed. This means that the offer automatically expires, and the offeror is no longer bound by its terms. ( no exact definition of resonable time but in ramsgate victoria hotel 5 months was too long)

death: An offer is terminated upon the death of either the offeror or the offeree, as the ability to accept the offer ceases with the parties involved.

acceptence: once an offer has been accepted it has become a legally binding contract so the offer is no longer.

CONTRACT FORMATION

Acceptence

acceptence of an offer means unconditional agreement to all the terms of the offer.acceptence must match the terms of the offer exactly: ie mirror image This principle is known as the "mirror image rule," which dictates that any deviation from the original terms can be considered a counter-offer rather than acceptance.

how to accept an offer?

acceptence myst be communicated to the offeror. the person making the offer has to know that his or her offer has been accepted.

silence alone is not acceptence( felthouse f said to B “if i hear no more from you, i shall consider the horse mine at £30” This means that B's lack of response does not constitute acceptance of the offer, and therefore, the contract is not formed. )

acceptence can be in any form, provided it is definite and communicated to the offeror. this could be through words, writing or by positive conduct( "Brogden v. Metropolitan Railway Co. illustrated that a party can accept an offer through actions that clearly indicate agreement, even if not explicitly stated. For instance, if one party begins to perform the contract terms, this can serve as acceptance." )

if the offeror asks for acceptence in a particular way usually the acceptence must comply however if the other method of acceptence was equally effective and does not disadvantage the offeror it is valid( Yates v pulleyn)

acceptance by post

when acceptence is communicated by post, it is deemed effective when the letter is posted, known as postal rule as established in the case of Adams v. Lindsell. This means that the acceptance is considered valid even if the offeror does not receive the letter immediately or at all, provided that the letter was properly addressed and stamped. This principle underscores the importance of the postal rule in contract law, allowing for a clear point at which acceptance occurs, independent of the offeror's awareness.

even if the letter was never recieved the rule applies(household fire insurance)

the postal rule can be avoided by stating in the offer that there will be no contract unless the acceptance is actually recieved (holwell securities)

electronic methods of communication