offer and acceptance

• Contract


  An agreement between 2 or more parties that must have: offer, acceptance, consideration, intention to create legal relations
• Elements required for a valid contract

  • Offer
  • Acceptance
  • Consideration
  • Intention to Create Legal Relations
• Unilateral contract


  Promise in return for an act
• Bilateral contract


  Promise in return for a promise
• Unilateral agreements


  • "I will pay £1000 to anyone who finds and returns my lost dog"
  • "I will give you £50 if you don't smoke for a week"
  • Seller promises to pay % of house price to Estate Agent, but EA under no obligation to sell the house
• Offer


  A statement, either written or oral, of a willingness to be bound by the terms of that statement
• Invitation to treat


  The maker of the statement is not intending to be bound by the terms put forward, it is merely their current negotiating position
• Distinguishing offer and invitation to treat

  • Storer: "if you will sign the Agreement and return it to me, I will send you the Agreement signed on behalf of the [Council]"
  • Gibson: "The corporation may be prepared to sell the house to you at the purchase price of…£2,180"
• Types of invitations to treat

  • Display of goods
  • Websites
  • Mere statements of price
  • Invitations to tender
  • Auctions
  • Advertisements
• Display of goods as invitation to treat

  • Fisher v Bell
  • Pharmaceutical Society of Great Britain v Boots Cash Chemists (Southern) Ltd.
• Websites displaying goods are likely to be treated as invitations to treat
• Mere statements of price as invitation to treat


  • Harvey v Facey
• Invitation to tender


  Generally an invitation to treat, but can be an offer if the wording indicates the highest/lowest tender will be accepted or all tenders will be considered
• Invitations to tender as offers


  • Harvela Investments Ltd. v Royal Trust of Canada (CI) Ltd
  • Blackpool and Fylde Aero Club Ltd v Blackpool Borough Council
• Auction


  Generally an invitation to treat, but if there is no reserve price the auctioneer is obliged to accept the highest bid
• Auctions as invitations to treat

  • Harris v Nickerson
  • British Car Auctions v Wright
• Auctions without reserves as offers

  • Warlow v Harrison
  • Barry v Davies (T/A Heathcote Ball)
• Advertisements


  Generally considered invitations to treat, but can be offers in some circumstances
• Advertisements as invitations to treat

  • Partridge v Crittenden
  • Grainger & Sons v Gough
• Advertisements as offers


  • Carlill v Carbolic Smoke Ball Company
  • Bowerman v ABTA
• Determining if an advertisement is an offer

  • Is it a unilateral agreement?
  • Is it advertising a reward?
  • Is the advertisement limited to a certain number of goods?
• A contract must have: offer, acceptance, consideration, and intention to create legal relations
• Contracts can be unilateral or bilateral
• It is important to establish if something is a valid offer or an invitation to treat
• Invitations to treat usually fall into 6 categories: display of goods, websites, mere statements of price, invitations to tender, auctions, advertisements
• Advertisements are usually invitations to treat, but can also constitute offers in some circumstances
• Offer


  A proposal to enter into a contract
• Communication of offer


  • The offer must be communicated to the offeree to be effective
  • A person cannot accept an offer of which they are unaware
• Communication of offer


  • R v Clarke (1927) 40 CLR 227
  • Williams v Cawardine (1833) 5 C&P 566
• Communication of offer


  • Taylor v Laird (1856) 25 LJ Ex 329
  • Inland Revenue Commissioners v Fry (2001) NLJ, 7th December
• Ways an offer can be terminated

  • Offeree rejects the offer
  • Lapse of time
  • Death of the offeror/offeree
  • Failure of a precondition
  • Revoked before acceptance (revocation of offer)
• Rejection of offer


  • If the offeree rejects the offer, then this terminates the offer
  • The offeree cannot then go back and try to accept the offer at a later date
• Rejection of offer


  • Hyde v Wrench [1840] EWHC Ch J90
  • Brogden v Metropolitan Railway (1877) 2 App Cas 666
• Lapse of time


  • The time on the offer could lapse in 1 of 2 ways:
  • There is a specified time limit
  • Lapse of reasonable time
• Lapse of time


  • Ramsgate Victoria Hotel Co Ltd v Montefiore (1866) LR 1 Ex 109
• Death of offeror/offeree


  • If the offeror dies, their representatives may still be bound by the acceptance of the offeree, if the offeree does not know about the death
  • No English caselaw for where an offeree has died
• Death of offeror


  • Bradbury v Morgan (1862) 158 ER 877
• Failure of a precondition


  Some offers can be made subject to certain conditions, and if these conditions are not met, the offer can lapse
• Failure of a precondition


  • Financings Ltd v Stimson [1962] 2 All ER 386
• Revocation of offer


  Generally, an offer can be revoked at any time before acceptance