LAW299

• Contract


  An agreement enforceable by law
• Elements of a valid contract

  • Offer
  • Acceptance
  • Intention to create legal relations
  • Consideration
  • Certainty
  • Capacity
  • Free consent
• Offer


  When one person signifies to another his willingness to do or to abstain from doing anything, with a view to obtaining the assent of that other to the act or abstinence
• Promisor


  The person making the proposal
• Promisee


  The person accepting the proposal
• A contract can be made in any form - writing, oral or by conduct or by a combination of these methods
• Example of contract by conduct

  • Suhaila entered beauty competition and agreed to be bound by the rules
• Communication of an offer

  Proposal can be made to individual, a class of persons, a company, or the general public (world at large)
• Communication of a proposal

  The proposal is effective & complete once it comes to the knowledge of the acceptor
• Invitation to treat


  A sort of preliminary communication at the stage of negotiation, a mere invitation by one party to the other party to make an offer. It is not an offer which is capable of being turned into a contract
• Examples of invitation to treat

  • Displaying of goods at shop window/shelves
  • Price lists
  • An auction
  • An advertisement
• the murderer's conviction after she was severely beaten and bruised
• The court found out that she was not induced by the offer of the reward but the information was given because she believed that she had not long to live and to ease her conscience
• Court's decision


  She is entitled to the reward because she was aware the existence of the reward. Her motive is irrelevant.
• Invitation to treat


  A sort of preliminary communication at the stage of negotiation. It is a mere invitation by one party to the other party to make an offer. It is not an offer which is capable of being turned into a contract.
• Examples of invitation to treat

  • Displaying of goods at shop window/ shelves
  • Price lists
  • An auction
  • An advertisement
  • Issuance of prospectus by public company
  • Tender
  • Supply of information
• In Pharmaceutical Society of Great Britain v. Boots Cash Chemists [1953] 1 QB 401, the court ruled that the display of goods on shelf was only an invitation to treat. The proposal was made by the buyer when she placed the item into the basket. There was no sale effected until the customer's offer to buy was accepted by the registered pharmacist at the counter by the acceptance of the price.
• In Fisher v. Bell [1961] 1QB 394, CA, the court ruled that the displaying of the flick knife was merely an invitation to treat. Hence, there was no offer for sale and the defendant could not be guilty of an offence.
• Offer and counter offer

  Modification of the original offer. The acceptor changes a vital term of the contract, such as the price of goods. An acceptance must be absolute and unqualified.
• Effect of counter offer

  It operates as a rejection of the original offer. The original offer is destroyed and can no longer be accepted. The acceptor becomes the proposer while the proposer now becomes the acceptor.
• In Hyde v. Wrench, the plaintiff's letter on 8th of June had rejected the original offer, so there was no acceptance when the plaintiff later wrote to accept the original offer.
• Request for further information

  It does not operate as a rejection to the original offer as the acceptor is only making a request for further information pertaining to the contract.
• In Stevenson Jaques & Co. v. McLean [1880] 5 QBD 346, the court ruled that the plaintiff's telegram was a mere request for further information, not a counter offer, so the defendant's later telegram amounted to a rejection of the original offer.
• Cross offer


  Both parties are making offers in identical terms. There is no contract between both parties as there are only offers but no acceptance.