Offer & Acceptance-Acceptance

-Offer/Proposal
Defn.- Sec”2a”-’ Where one person signifies to
another his willingness to do or to abstain from
doing anything, with a view to obtain the assent
of the other in such act or abstinence, he is
said to make an offer”
-Term proposal in ICA- synonymous with offer
in English Law.
-Offer- to obtain from another.
sell a accepts
-Eg:A B A
radio same amount
Intention of A to obtain assent from B
 Offer & invitation to treat-
distinguished
- A gives information on his goods- view to invite others to
make offer:
-eg:1. Book seller- Catalogue
2. Persons invited for Auction
3. calling for tenders,
submission of tender( however is an offer)
- Withdrawal of Offer:
- Can withdraw before it is accepted- an auctioneer can call
off his auction, invitation to treat and not an offer.
Harris Vs Nickerson
- Defendant advertised- sale by auction-plaintiff went to the
place of auction- auction called off- plaintiff brought an
action for expenses- held not entitled- contract not yet-
invitation to treat not an offer.
 Continued
• Goods displayed with price tags- invitation to treat:
“ Pharmaceutical Society of Great Britain
Vs
Boots Cash Chemists Ltd.”
- Self service- pick up goods, go to the counter- he can
reject.

- Quotation of price held not an offer:

“ Harvey Vs Facey”
- Bumper Hall pen a plot of land-Plaintiff interested to
purchase sent a telegram- quote lowest price-Defendant
quoted $900- Plaintiff replied agreed- Defendant did not
give title deed- action-held- plaintiff agreeing to pay $900
only an offer- not accepted by defendant- no contract-
Judicial committee of privy council held it so.
 Continued
“ Badri Prasad Vs State of Madhya Pradesh”
- Contract on big trees in dispute- forest officer wrote to
plaintiff for further payment of RS 17000/=- Plaintiff
agreed- held to pay further amount is only an offer- not
yet accepted by defendant- held by supreme court – no
contract.

- “ Mac Pherson Vs Appanna”

- Plaintiff offered Rs 6000 for property-again wrote to
agent of defendant- whether accepted- no not les than
Rs 10000- plaintiff willing- held letter from agent was an
invitation to treat and not an offer.
 INTENTION TO CREATE LEGAL
RELATIONSHIP
• - Offer is to be made with an intention to create
legal relationship:
• Eg. Promise- social engagement to go for a
walk, entertain another.

“Rose and Frank Co.Vs Crompton & bros.Ltd.”

- Agreement not formal or legal- not subject to

legal jurisdiction of any court- carried through
mutual loyalty & friendly co-operation- held
agreement was not formal- no legal relationship
established- not enforceable.
 Continued
“ Belfour Vs Belfour”
- Defendant employed in govt. job in Ceylon-
holiday to England with wife- wife did not
return health reason- husband promised to
pay $30 p.m.during stay alone to wife- did
not pay- held no intention to create legal
relationship- same rule- close relations-
parents - children
 Continued
• “ Jones Vs Padavatton”
Mrs Jones living in Trinidad and Daughter-
divorced- in washington working for Indian
Embassy- mother persuaded daughter to study
law and become barrister in England- bought a
house- one part to live and another rent and
use.
- Difference of opinion- mother wanted to evict-
daughter claimed maintenance- held no intention
to create legal relation- eviction succeeded.
 Continued
• In some cases intention can be presumed- then
not exempted from liability- even incase of close
relationship.
“Meritt Vs Meritt”
-Husband and wife joint owners of house-
Husband lived with another woman-Husband/
wife’s insistence signed a note- wife pay balance
of house loan- he transfer property to her sole
ownership- held contract valid.
 Communication of Offer
• Offer can be accepted only if it comes to the
knowledge of the offeree- i.e. it must be
communicated.
• “Sec 4”- “ The communication of the proposal is
complete when it comes to the knowledge of the
person to whom it is made”
• - Acting in ignorance of offer- not acceptance.
• - not communicated- but come to knowledge-
acts accordingly- acceptance
 Continued
“ Lalman Shukla Vs Gowri Dutt”
-defendant nephew absconded- plaintiff was his servant-
sent to search for- defendant announced a reward of Rs
501/= not known to plaintiff who found the lad- claimed
reward- held not eligible.
- However a person has knowledge of offer and acts
accordingly- deemed acceptance
- “ William Vs Carwardance
- Reward announced- any one giving information leading
to conviction of an assailant for murder- plaintiff gave
information to ease her conscience- them claimed
reward- held valid
 Cross offer
• - Two parties- similar terms of bargain- cross
each others in post- no contract unless either of
the party having knowledge accepts the offer.
“ Tinn Vs Hoffmann”
-A to B- intention to sell 800 tones of iron at 69
shillings per tone. On same day B to A
willingness to buy 800 tones of iron at 69
shillings per tone- cross offer- B brought action
on a for supply of iron- held no contract existed.
 Specific and General Offer

- Offer to specific person

- Not to any specific person but to the
general public at large:
- Eg; any person who finds the lost dog is
given an award of Rs 100/=-general offer-
any person who finds it is deemed to have
accepted the offer- contract exists
 Continued
• “Sec 8”- “ Performance of the condition of an offer is an
acceptance of the offer”

“ Carlill Vs Carbolic smoke ball co.”

-Carbolic Co.- preventive remedy for influenza- a person

takes it three times a day for two days- still gets cold,
influenza or other disease caused by cold- paid a reward
of $ 100- they also announced this-lodged $1000 in
alliance Bank- Carlill followed- but caught influenza-
sued- held valid- condition satisfied.
Standing, Continuing or Open Offer
- Allowed to remain for some time until it is
accepted;
- Eg. 1. 1000 bags of wheat from 1st Jan. to 31st
Dec. as and when orders received
- 2. Tender for supply of goods is a kind of
standing offer- as and when order placed on the
basis of tender- acceptance
- Offer ( such ) can be with drawn any time before
acceptance- even if it is open for a particular
time can be revoked
 Continued
“ Bengal coal co.Vs homee Wadia & Co.”
- Bengal Coal to supply coal to homee Wadia- 12 months-
as and when order received- Before 12 months
defendant- Bengal coal revoked offer- did not honour
subsequent order- held no contract existed after
revocation of offer.

“ Union of India Vs Maddala Thathaiah”

-Dominion of India as owner of railways invited tender for
supply of 14000 mounds of cane jaggery to railway grain
shop- right to cancel contract at any stage- valid – can
cancel.
 Continued
• Any offer- including open – cancelled before acceptance.
“ Rajendra Kumar Sharma Vs state of M.P.”
- State of MP- tender invited- sale of tendu patta (Leaves)-Petitioner
Rajendra submitted tender- 9ty April to be opened. Before wrote not
to open- but opened – only tender- Petitioner refused to execute-
MP sold to some other party– Action against Rajendra for damages
of Rs 25000/-there was a clause– no withdrawal of tender allowed-
held in spite of the clause tender/ offer can be with drawn/revoked
before acceptance.
- Again in-
”Suraj Besan and Rice Mill Vs food corporation of India”
- Held can with draw/modify offer/ tender before acceptance.
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