offer and acceptance

• what is Treitel's definition of an offer

  an offer is an expression of willingness to contracts on certain terms made with the intention that it shall become binding as soon as it is accepted by the person to whom it is addressed
• in order to amount to an offer, it must be clear and communicated and it must be shown that the offerer had the intention to be bound - Harvey v Facey
• Invitation to treat cannot be accepted it is merely an invitation for offers, it is a statement indicating readiness to enter into contract negotiations
• Partridge v Crittenden 


  an advert is an invitation to treat unless it contains an offer which is accepted through an action only
• Carlill v carbolic smoke ball co


  in some instances, such as where there is a unilateral contract, an advert can amount to an offer
• goods on display in shops are generally not offers but an invitation to treat, the customer makes an offer to purchase the goods, the trader decides whether to accept
• pharmaceutical society of great britain v boots


  the offer to purchase happens when a product is taken to the til;
• fisher v bell 


  never an offer to sell, only to buy
• british car auction v wright 


  an auction is only an offer to sell in, is therefore not an offer to buy until the auction is ended and won by someone offering to purchase
• online orders only become an offer once the order is placed
• Requirements for a valid offer

  An offer can be made by anyone - an individual, partnership, limited company etc.

  An offer can be made by notice or a machine as in Thornton v shoe lane parking, this case tells us machines or notices are capable of making a valid offer
• Requirements for a valid offer

  • An offer can be made to a named individual like in Gibson v Manchester City Council. This case told us that there was no concluded contract as the councils letter didn't state the price and was not an offer but an invitation to treat.
  • A group of people as at an auction or the world at large like in Carlill v Carbolic Smoke Ball Company
  • Targeted towards particular individuals or conditional
• Start of an offer

  • Communication requires the offeree to know of the existence of the offer with clarity on the terms - Taylor v Laird. ( T commanded L's ship but had resigned to crew member during the ride, it hadn't been communicated to L and he couldn't claim wages )
• Start of an offer

  Exact timing can be critical - Stevenson v Maclean

  • m offered to sell s iron, s agreed to price and inquired about 4 months credit rather than cash, after hearing nothing S accepted offer. The inquiry was a request for information not a counter offer so it was a valid acceptance
• Termination of an offer

  1. Acceptance by one or more parties
  2. Rejection
  3. Death of Offeree or Offerer - if the offeree dies then the offer ends, his executors or administrators can make a new offer as can the offerer. If the offerer die, acceptance can still takes place until the offeree learn of the death unless for a service
• Termination of an offer

  4. Lapse of time - offer terminates after a reasonable lapse of time which depends on the circumstances

  Ramsgate Victoria Hotel v Montefiore - D offered to buy shares, after 6 months the claimant accepted by which time the value of shares and fallen. D refused to go through with sale. Offer was no longer open as due to the nature of the subject matter.

  5. Condition of offer not met
• Termination of an offer

  6. Revocation offer may be revoke at any time before acceptance and a promise to keep offer open is known as a collateral contract - it is not binding unless supported by consideration.

  Routledge v Grant - An offerer can withdraw his offer at any time prior to acceptance

  Dickinson v Dodds - Communication of revocation does not to be by or with the authority of the offerer

  It only takes place when communicated
• Termination of an offer - counter offer

  Implied rejection. It is where the offeree responds to an offer by making an offer on different terms. This has the effect of destroying the original offer so that it is no longer open .

  Hyde v Wrench - Counter offer automatically terminates original. W offered to sell farm for £100 and rejected H's offer of £950. He refused the higher offer and sold to someone else

  Requests for information

  • not a rejection of an offer so the offer remains and can still be accepted
  • Stevenson, Jaques & Co v Mclean - request for info is not rejection of the offer
• Acceptance

  Treitals definition says acceptance is the final and unqualified expression of assent to the terms of an offer. Three main rules for acceptance:

  • Acceptance must be positive
  • Acceptance must be unconditional
  • Acceptance must be communicated
• Acceptance must be positive

  Offeree must via an act, words or conduct declare their acceptance of an offer it can be via silence or omission.

  • Acceptance in unilateral contracts is typically via an act as the act itself indicates accpetance
  • Silence does not constitute acceptance - Felthouse v Bindley ( nephew discussed buying a horse from uncle and said if I don't hear from you by weekend I'll consider him mine. Horse then sold by mistake at auction. Action against auctioneer depended on whether there was a valid contract between uncle and nephew.
• Acceptance must be positive

  • Northern Foods v Focal Foods - NF made claim against FF for breach of contract to supply onions. FF had been supplying veg for years and then tried to change the price and NF argued this was a breach of contract. CASE TELLS US : Offer made was accepted by FF by its conduct in trading upon the basis of the terms NF offered.
• Acceptance must be unconditional

  • acceptance of all proposed original terms
  • agreement must mirror offer
• Acceptance must be communicated

  • Offerer must receive the acceptance before its effective
  • Can be in any form provided it is clear and communicated to the offerer.
  • Entorres v Miles Far East - claimant sent message of offer from England to Holland. The defendants sent message back accepting the offer. CASE TELLS US : Acceptance communicated once it is received not sent.
• Acceptance must be communicated

  offerer can require a specific method for acceptance but this can be waivered.

  • Yates v Pulleyn - D gave C option to purchase land stating notice of acceptance should be returned by registered or recorded delivery but C sent it via normal post. CASE TELLS US : A specific method can be requested but it is widely accepted as its the same type of communication so its sufficient
• Acceptance must be communicated

  Acceptance can be through conduct

  • Brogden v Metropolitan Railway Co. - Claimants were suppliers of coal to defendants. Had been dealing with no written contract. The parties agreed they should have a formal contract. D drew up draft contract, claimant made minor amendments and send it bac. D then simply filed document and never communicated the acceptance. They continued to supply the coal. CASE TELLS US : written contract valid, acceptance took place by performing contract with no objections
• Acceptance must be communicated

  out-of-hours messages of acceptance are only effective when office reopens

  • Brinkibon Ltd v Stahag Stahl -Brinkibon (London) telexed their acceptance of a contract offer to purchase steel from Stahag in Vienna, Austria. Later Birnkibon wanted to claim damages, as the contract was formed in Austria it had to go through Austrian courts. CASE TELLS US : Out of hours messaged are only communicated during office hours and will be classed as when reasonably should've been seen
• Acceptance must be communicated

  Rules only apply to letters of acceptance. Rules set out in Adams v Lindsell :

  • rules only apply if post is usual or expected means of communication
  • letter must be properly addressed and stamped
  • offeree myst be able to prove the letter was posted

  Household Fire v Grant - legally binding contract effective at time of posting.