Requirements for a Valid Offer

Question 1

An offer must be…

Answer 1

clear + certain, displaying an intention to be bound

Question 2

Acceptance must be…

Answer 2

unequivocal acceptance

Question 3

How is the intention to be legally bound assessed?

Answer 3

Objectively by what a reasonable man would say the parties intended, on the basis of their offer.

What was actually in the minds of the people isn’t relevant.

Question 4

What are bilateral contracts?

Answer 4

Each party assumes an obligation to the other party by making a promise to do something, such as to sell an item to the other party in exchange for a payment.

Question 5

What are unilateral contracts?

Answer 5

One party makes an offer/ proposal in terms which call for an act to be performed by one or more other parties.

eg: the offer may call for specific lost property to be returned in exchange for a reward. A unilateral contract does not involve mutual promises – only the party making the offer assumes an obligation. Only actual performance of the required act will constitute acceptance.