Agreement and Contractual Intention

Question 1

What is the definition of an offer?

Answer 1

An expression of willingness to contract 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 (Treitel).

Question 2

The courts adopt an objective approach to determining whether there was an agreement between parties.

Answer 2

Smith v Hughes

Question 3

If an offeror so acts so that their conduct, objectively considered, constitutes an offer, and the offeree, believing that the conduct of the offeror represents their actual intention, accepts the offer, then a contract will come into existence.

Answer 3

Allied Marine Transport

Question 4

Goods on display in supermarkets and self-service shops are generally regarded as invitations to treat.

Answer 4

Boots Cash Chemists

Question 5

Advertisements are generally regarded as invitations to treat.

Answer 5

Partridge

Question 6

An advertisement for an award has traditionally been treated as an offer as there is an intention to be bound as soon as information is given.

Answer 6

Williams v Carwardine

Question 7

If there are special circumstances which show an intention to be bound, an advert may amount to an offer.

Answer 7

Carbolic Smoke Ball Co

Question 8

An advertisement can constitute an offer to ‘the world’ (i.e. a unilateral contract).

Answer 8

Carbolic Smoke Ball Co

Question 9

Which statute states that a sale by auction is completed on the fall of the auctioneer’s hammer?

Answer 9

s57(2) of the SGA 1979

Question 10

If an auction is advertised as ‘without reserve’, this constitutes an offer of a unilateral contract by the auctioneer.

Answer 10

Barry v Davies

Question 11

There may be situations when an invitation to tender does constitute an offer.

Answer 11

Harvela Investments

Question 12

A case where the defendant was held liable for loss of opportunity after not considered a specific claimant’s tender.

Answer 12

Aero Club Ltd

Question 13

Offers kept open for a certain period of time by promise are not binding if they are gratuitous promises.

Answer 13

Routledge

Question 14

A promise to keep an offer open is binding if the claimant provides consideration for it.

Answer 14

Mountford

Question 15

Notice of withdrawal of an offer must be given and communicated to the offeree to be effective.

Answer 15

Byrne

Question 16

Newspaper advertisements can likely be revoked by publishing a sufficiently prominent notice of withdrawal in the same section of the newspaper as the advertisement was posted.

Answer 16

Shuey

Question 17

A notice of revocation will be effective upon receipt in a commercial setting where it is reasonable to expect a member of staff to be able to read a notice of revocation.

Answer 17

The Brimnes

Question 18

Revocation can be communicated by a reliable third party.

Answer 18

Dickinson

Question 19

Partial performance of a unilateral contract may be sufficient to prevent revocation by the offeror.

Answer 19

Errington and Woods

Question 20

An offer may be impliedly rejected by an offeree’s counter-offer.

Answer 20

Hyde

Question 21

A simple request for information does not affect an offer and it can still be accepted.

Answer 21

Stevenson Jacques

Question 22

What is the definition of acceptance?

Answer 22

A final and unqualified expression of assent to the terms of an offer (Treitel)

Question 23

An offeree must know of an offer to accept it.

Answer 23

Clarke

Question 24

It does not matter that an individual has mixed motives in accepting an offer.

Answer 24

Williams v Carwardine

Question 25

Battle of the forms

Answer 25

Butler Machine Tool Co

Question 26

Delivery of a machine might be regarded as acceptance by conduct of the last set of standard terms to be proferred in a battle of the forms.

Answer 26

Brogden

Question 27

Hire purchase agreements in the absence of specific details (e.g. duration, number and amount of repayments) are too vague in themselves to be a contract

Answer 27

Scammell

Question 28

A contract to supply timber of 'fair specification' was held to be valid.

Answer 28

Arcos

Question 29

The general rule is that acceptance must be communicated.

Answer 29

Entores

Question 30

An offeror cannot impose a contract on the offeree by stipulating that the offeree's silence constitutes an acceptance.

Answer 30

Felthouse

Question 31

There is no reason in principle why an offeree cannot bind themselves to accept by silence.

Answer 31

Re Selectmove

Question 32

The postal rule

Answer 32

Adams v Lindsell

Question 33

A letter does not need to arrive for the postal rule to be valid.

Answer 33

Household Fire

Question 34

What are the four limitations to the postal rule?

Answer 34

(a) It only applies to acceptances; (b) It only applies where it was reasonable to send an acceptance by post; (c) The letter must be properly stamped, addressed and posted; (d) The rule can always be excluded.

Question 35

By using the word 'notice', the defendant had impliedly excluded the postal rule.

Answer 35

Holwell Securities

Question 36

Acceptance by electronic communication takes place when the communication is received.

Answer 36

Entores

Question 37

Within the context of acceptance by electronic communication, there is no universal rule and it must be determined by reference to party intentions, by sound business practice and, in some cases, judgment where the risks should lie.

Answer 37

Brinkibon

Question 38

There is a presumption that domestic agreements are not made to be binding.

Answer 38

Balfour v Balfour

Question 39

If a couple has separated, the likelihood is that they intend to create legal relations.

Answer 39

Meritt v Meritt

Question 40

The greater the consideration involved, the more likely a domestic agreement was entered into with the intention to create legal relations.

Answer 40

Parker v Clark

Question 41

Mutual understanding between a group of employees to share their lottery winnings if they win constitutes a kind of binding, informal syndicate.

Answer 41

Pays

Question 42

There is a presumption that commercial agreements are made to be binding.

Answer 42

Skyways

Question 43

The presumption of a binding commercial agreement can be rebutted with evidence of a clear clause to the contrary.

Answer 43

Crompton Bros