Contract Law - Offer & Acceptance

Question 1

Contract Definition

Answer 1

S2(h) - an agreement enforceable by law

Question 2

Offer Definition

Answer 2

S2(a) - one person signifies to another his willingness to do or abstain from something, with a view to obtaining the assent (agreement) of that other to the act or abstinence

S2(c) - offeror makes offer, offeree has offer made to them

Question 3

Invitation to Treat

Answer 3

preliminary communication at stage of negotiation (to induce offer)

Question 4

Advertisements - Offer or ITT

Answer 4

advertisement of tenders - ITT
advertisement of jobs - ITT
advertisement for sale of goods - depends on intention to be bound

Question 5

Display of Goods in Shop - Offer or ITT

Answer 5

Invitation to Treat

Question 6

Pharmeceutical Society of Great Britain v
Boots Cash Chemist Ltd

Display of goods in shop

Answer 6

Defendants charged for sale of goods without supervision of pharmacist. Products were on display shelf with prices marked, pharmacist was at counter.

Held: display of goods - ITT, customer placing drugs in basket - offer, payment at counter - acceptance. sale was done at counter (supervised).

Question 7

Partridge v Crittenden

Advertisement for sale of goods

Answer 7

Defendant advertised for sale of chickens with prices. It was illegal to sell wild live birds. RSPCA convicted him. He appealed.

Held: advertisement is ITT - no intention to be bound

Question 8

Carlill v Carbolic Smoke Ball Co Ltd

Advertisement for sale of goods

Answer 8

Company advertised that they’d offer $100 to anyone who still got influenza after using their product for a certain period. Plaintiff duly used it, but still got influenza. Plaintiff sued.

Held: advertisement was offer - there is intention to be bound, plaintiff accepted offer when she bought & used it

Question 9

Essential Features of Offer

Answer 9

1. intention to be bound
2. request and supply of information is not offer
3. S4(1) - communication of offer is complete when it comes to the knowledge of the offeree
4. S5(1) - revocation/withdrawal of offer can be done before acceptance
5. S6(1) - revocation of offer must be communicated to offeree

Question 10

Harvey v Facey

Request and supply of information - not offer

Answer 10

Purchaser sent telegram requesting price. Seller replied with lowest price. Purchasers did not respond, sellers refused to complete sale.

Held: no offer/agreement to sell, sellers only supplied information

Question 11

Acceptance Definition

Answer 11

S2(b) - when the person to whom the proposal is made to signifies his assent thereto

when offer is accepted, it becomes a promise

Question 12

Essential Features of Acceptance

Answer 12

1. S7(a) - acceptance must be absolute & unqualified
2. counter proposal is a rejection of the original proposal
3. acceptance is only effective when it has been communicated
4. silence is not a mode of acceptance

Question 13

Felthouse v Bindley

Silence is not a mode of acceptance

Answer 13

Plaintiff had conversation with nephew about buying his horse. Uncle replied by letter stating if he didn’t hear from nephew, he would consider it acceptance and thus own the horse. Nephew sells horse by accident.

Held: there is no contract - silence is not a form of acceptance

Question 13

Hyde v Wrench

Counter proposal is a rejection of the original proposal

Answer 13

Wrench offered to sell for certain price. Hyde made counter offer. Wrench refused. Hyde says he will accept the earlier offer.

Held: Hyde cannot do so, he has rejected & terminated the earlier offer.