Name: MD.

Hossain Ahamed (Arian)

ID:20-42570-1

Distinction between offer and invitation to treat

1. Offer is the first starting point for formation of any contract. It is also called ‘proposal the person
who makes the offer is called as ‘offeror’ and to whom the offer is made is called as ‘offeree’

And When a person expresses something to another person, to invite him to make an offer it is
known as invitation to offer.!

2. Section 2 (a) of Indian Contract Act, 1872 defines offer as “ When one person signifies to
another his willingness to do or to abstain from doing anything, with a view to obtaining the
assent of that other to such act or abstinence, he is said to make a proposal “The term
‘proposal’ used in the Indian Contract Act, 1872 is synonymous with the term ‘offer’ used in
English law.

Invitation to offer is not defined in the Indian Contract Act, 1872.It can be defined as “when one
party / persons are invited to one or more offer is called as invitation to offer”. It is not required
for them to get into contract.

3. Offer is made to get accepted

And Invitation to offer is made to get offer

4. Object of offer is to enter into contract

And Object of invitation to offer is to receive offers from people thereafter contract will be
created.
5. Offer becomes an agreement when it is accepted
And an invitation to offer becomes an offer.

The dissimilarity between an Offer and an Invitation to Treat is frequently firm to draw as It depends On
the indefinable measure Of Intention. But there is particular stereotyped condition that the dissimilarity
Is define by Rules of Law" preface an offer is made when a person displays a compliance to enter into a
legally binding contract. An invitation to treat is merely a supply of information to entice a person into
making an offer. Though, the distinction between the two can often be puzzling and ultimately misread.
When misinterpretations and perplexity occur then it is down to the courts to decide and to distinguish
between the two terms, so a person is not led into a binding contract of which he does not want to be a
part of, (Harvey V Facey [1893] ) but is merely purvey information to which an offer is to be made. offers
and Invitations.

Harvey V Facey [1893] A.C 552

Holding and Rule: No. A mere statement of the minimum selling price is an invitation to treat and not an
offer to sell. The court held that by replying to P’s question regarding the lowest price of the property, D
did not make an affirmative answer to the first question regarding his willingness to sell. The court held
that D had made an invitation to trade and not an offer.

In this case, Facey (D) was in negotiations with the Mayor and Council of Kingston concerning the
auction of his store. Harvey (P) sent Facey a telegram stating: “Will you sell us Bumper Hall Pen?
Telegraph lowest cash price-answer paid.” On the same day, Facey sent Harvey a reply by telegram
stating: “Lowest price for Bumper Hall Pen £900.” Harvey sent Facey another telegram approving to
acquisition the stuff at the asking price. D refused to sell and P sued for specific performance and an
injunction to prevent Kingston from taking the property. The trial court dismissed on the grounds that
an enforceable contract had not been formed and P appealed. The Supreme Court of Jamaica reversed
and D appealed.

Issue: Is a statement of the minimum price at which a seller would sell an offer?

The dissimilarity between an Offer and an Invitation to Treat is frequently firm to draw as It depends On
the indefinable measure Of Intention. But there is particular stereotyped condition that the dissimilarity
Is define by Rules of Law" preface an offer is made when a person displays a compliance to enter into a
legally binding contract. An invitation to treat is merely a supply of information to entice a person into
making an offer. Though, the distinction between the two can often be puzzling and ultimately misread.
When misinterpretations and perplexity occur then it is down to the courts to decide and to distinguish
between the two terms, so a person is not led into a binding contract of which he does not want to be a
part of, (Harvey V Facey [1893] ) but is merely purvey information to which an offer is to be made. Offers
and Invitations.