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Offer and Acceptance Flashcards

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1
Q

What are the four requirements of an enforceable contract?

A

Offer and agreement, Consideration, Intention, Certainty

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2
Q

What approach do courts use to determine if there is an offer and agreement?

A

Objective analysis

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3
Q

What is a bilateral agreement?

A

A promise in exchange for a promise, where both parties agree to something on common terms

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4
Q

What is a unilateral agreement?

A

A promise in exchange for an act, where only one party is bound at the outset

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5
Q

What distinguishes an offer from an invitation to treat?

A

An offer is a definite promise to be bound if the offeree agrees; an invitation to treat invites others to negotiate

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6
Q

What is the mirror image rule in contract acceptance?

A

The response must correspond with the exact terms of the offer

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7
Q

What happens if an offeree introduces a new term in their response?

A

It constitutes a counter-offer rather than acceptance

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8
Q

What is the significance of actual communication for an offer?

A

An offer must be communicated to the offeree to be effective

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9
Q

What are the three requirements for acceptance?

A
  • The response must correspond with the exact terms in the offer
  • It must be in response to the offer
  • The response must follow any prescribed method for acceptance
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10
Q

What is the effect of the postal rule of acceptance?

A

Acceptance is complete as soon as the letter is posted

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11
Q

Can silence be considered as acceptance in a bilateral contract?

A

Generally, no, unless there are exceptions

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12
Q

What is the rule regarding revocations of offers?

A

An offer can be revoked at any time before acceptance

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13
Q

What is a counter-offer?

A

A response that purports to accept but adds or amends terms, thus cannot be an acceptance

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14
Q

What case established that a counter-offer kills the original offer?

A

Hyde v Wrench [1840]

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15
Q

What does the ‘battle of the forms’ refer to?

A

Analysis of whether an agreement results after parties exchange differing standard terms

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16
Q

What is the general rule for acceptance communication?

A

Acceptances need to be ‘actually communicated’

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17
Q

What is the implication of the receipt rule?

A

Acceptance is effective only when received by the offeror

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18
Q

What is the significance of the case Adams v Lindsell [1818]?

A

Established the postal rule of acceptance

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19
Q

What is a unilateral offer?

A

A promise in exchange for an act, usually found in advertisements

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20
Q

What is the principle regarding acceptance in unilateral agreements?

A

Acceptance must be in response to the offer and with knowledge of it

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21
Q

Fill in the blank: An acceptance must follow any _______ for acceptance prescribed in the offer.

A

[method]

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22
Q

True or False: An offeror can revoke their offer after acceptance has occurred.

A

False

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23
Q

Why is it important for an offer to be communicated?

A

An offeree cannot accept an offer they do not know about

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24
Q

What is the legal effect of a request for further information?

A

It does not constitute a counter-offer but a simple request for info

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25
What happens if the method of acceptance is not mandatory?
Any other method will suffice as long as it fulfills the purpose behind the prescribed method
26
What is a unilateral agreement?
A promise in exchange for an act
27
Are unilateral advertisements offers or invitations to treat?
Offers
28
What is required for acceptance of a unilateral offer?
Acceptance must be in response to an offer – and with knowledge of it
29
What is implied regarding communication of acceptance in unilateral offers?
There is an implied waiver of the need to communicate acceptance
30
What case established that a unilateral advertisement is enforceable?
Carlill v Carbonic Smoke Ball Co [1893]
31
Can a unilateral offer of reward be accepted without knowledge of the offer?
No, it cannot be accepted if there is no knowledge of the offer (R v Clarke [1927])
32
What is the significance of the motive in responding to a unilateral offer?
The motive in responding is irrelevant as long as the offeree has knowledge of the offer (Williams v Carwardine [1833])
33
What happens if the offeree has begun to perform the requested act?
Revocation may not be possible once the offeree has started to perform the act
34
What was held in Errington v Errington & Woods (1952) regarding unilateral promises?
The unilateral promise could not be revoked once the couple had started to perform the act
35
What is the principle regarding communication of revocation of unilateral offers made to the whole world?
It is impossible for the offeror to comply with the normal rule requiring actual communication of revocation
36
What is a tender in the context of contracts?
An express promise to award work to the lowest tender or sell goods to the highest bidder
37
What is the significance of Harvela Investments Ltd v Royal Trust Co. of Canada Ltd [1986]?
It recognized a unilateral offer in the context of tenders
38
What occurs when there is an obligation to consider conforming tenders?
It amounts to a unilateral offer to consider all tenders that conform to the bid condition
39
What does an auction advertised as 'without reserve' imply?
A unilateral promise to sell to the highest genuine bidder
40
What is the difference between a void contract and a voidable contract?
Void = automatically of no effect; Voidable = liable to be set aside by one party
41
What makes an agreement too uncertain for enforcement?
If it is vague or essential terms are missing
42
What case illustrates that a vague essential term renders a contract void?
Scammell & Nephew v Ouston [1941]
43
What is a 'lock out' agreement?
An agreement to negotiate exclusively with one party
44
What was the outcome in Watford v Miles [1992] regarding agreements to negotiate?
The agreement was unenforceable for certainty as it was only an agreement to negotiate
45
What does Section 8(1) of the Sale of Goods Act 1979 state?
In a contract of sale, the contract may fix the price or provide a mechanism for fixing the price
46
What happens if there is no mechanism for fixing the price in a contract?
A reasonable price must be paid
47
What is the principle established in British Steel Corp v Cleveland Bridge & Engineering Co [1984]?
Parties may be required to pay for performance under an uncertain contract on the basis of quantum meruit
48
What is the significance of the case Sudbrook Trading Estate Ltd v Eggleton [1983]?
The court can substitute its own machinery to calculate a fair price when the original fails
49
What is the general outcome when an agreement has been executed by the parties?
It is unlikely that the courts would refuse to enforce it on the basis of uncertainty
50
What can be recovered under quantum meruit?
Reasonable value of services performed
51
What is a fundamental mistake in the context of agreements?
A mistake that may render the agreement void
52
What is the primary condition for recovery in 'exceptional cases' regarding services requested?
There must be a benefit to D in the performance of the services requested ## Footnote Recovery is limited and contingent upon clear benefits to D.
53
What factors are considered when determining if C would be compensated for services?
* Terms in which the request was made * Reasonableness of C's anticipated compensation * Nature of services typically provided free of charge * Circumstances of the failed contract and D's fault
54
What is the concept of agreement mistake?
An apparent agreement may be void due to a 'fundamental mistake' preventing true agreement ## Footnote This is determined by the lack of matching offer and acceptance.
55
What are the two types of agreement mistake?
* Mutual mistake * Unilateral mistake
56
What is a mutual mistake?
Both parties are mistaken about a term, each making a different mistake ## Footnote Results in no agreement if reasonable interpretation is ambiguous.
57
What case illustrates a mutual mistake?
Raffles v Wichelhaus [1864] ## Footnote Two ships named Peerless led to ambiguity, rendering the contract void.
58
What is a unilateral mistake?
One party is mistaken about a term, and the other party knows or should know of this mistake ## Footnote The contract is void if the second party takes advantage of the mistake.
59
What case illustrates a unilateral mistake?
Hartog v Collin & Shields (1939) ## Footnote D's offer to sell hare skins by the pound instead of by piece was void.
60
What distinguishes a fundamental mistake from a collateral matter?
A fundamental mistake concerns a term of the contract, while a collateral matter relates to the quality of the subject matter ## Footnote Collateral matters do not invalidate the agreement.
61
What case illustrates the distinction between fundamental mistakes and collateral matters?
Smith v Hughes [1871] ## Footnote The court found a valid contract despite D's claim of needing old oats.
62
What is a mistake as to identity?
Occurs when one party is mistaken about the identity of the other, and the other party knows of this mistake ## Footnote Only renders a contract void if it is fundamental.
63
What is the significance of the distinction between void and voidable contracts?
Only void contracts allow recovery of goods from an innocent third party ## Footnote If voidable, the right to set aside the contract may be lost.
64
What case illustrates a mistake as to identity?
Cundy v Lindsay [1878] ## Footnote The contract was void as the sellers intended to deal with a reputable firm, not a rogue.
65
What principle does Lewis v Avery [1972] illustrate?
Mistaken identity in face-to-face contracts presumes intent to deal with the person present ## Footnote The contract is voidable, protecting innocent third parties.
66
What is rectification in contract law?
The court may modify a written document to accurately reflect the parties' agreement ## Footnote This is done when the mistake relates to how the agreement was recorded.
67
What are the requirements for rectification according to Lord Hoffman?
* Common continuing intention * Outward expression of accord * Intention at the time of execution * Mistake in recording that intention
68
What case demonstrates the principles of rectification?
Joscelyne v Nissen [1970] ## Footnote The court ordered rectification to reflect the parties' true intentions.
69
What constitutes a successful plea of non est factum?
The signer is fundamentally mistaken about the nature of the document signed ## Footnote If successful, the contract is void, and third parties cannot acquire good title.
70
What case illustrates a failed plea of non est factum?
Saunders v Anglia Building Soc [1971] ## Footnote The widow's plea failed as the document signed was not fundamentally different from her intention.

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