Workshop 1 Summary.

(Offer and Acceptance)

Ideas to show a “meeting of minds”
Offer + acceptance + ITCLR + Consideration = Binding Contract

For a contract to exist =>

● The offeror must make an offer to the offeree and the offeree must communicate
unequivocal(leave no doubt or ambiguity) certainty and clear acceptance
● The test applied in ascertaining whether a contract exist is the **REASONABLE MANTEST
● NOT what the parties to an agreement intended. The an objective test court will consider this,
having all regard to all circumstances.

OFFER (3 things present)

Definition=> an undertaking to be connamuly bound in the event of unconditional acceptance being
received.
An offer must be
1. Clear
2. Certain
3. Display an intention to be bound

Certainty of an offer (look at the terms used)

Case
=>Gibson vs Manchester City Council
Held: there was no binding contract because there was never an offer made by the council. The
letter “IT MAY BE PREPARED TO SELL” was not sufficiently “CLEAR AND CERTAIN” to be an offer.
It was merely a 1st step in negotiation, lacking the requisite to be bound.
Above case contracted with
=> stores v Manchester City Council => The terms of the contract “If you will sign to agreement &
return it to me” I will send the signed agreement… [stale clarity & certainty to be legally bound] - my
analysis]

Unilateral & Bilateral Contracts

Uni => does not “involve mutual promises”
=> one party only makes the promise (offer)
=> only actual performance of the required act constitute an acceptance
***PRESCRIBED ACT + CLEAR INTENTION to be bound
E.g. Curxixm Curlill v Carbolic
Note that most invitations to treat are unilateral contracts.

Bi => Between two people. Each party assumes responsibility to the other by making a promise in
exchange(consideration) for a payment.

Invitation to Treat
It is the 1st step in a negotiation which may/may not lead to a firm offer by one of the parties.
Examples
1. Auction
2. Invitation to tender
3. Advertisement
4. Display of goods for sale

Advertisement
General rule established in the case of PATRIDGE VS CRITTENDEN.

Exception to the rule

This rule does not apply where the advertisement amounts to a unilateral offer

Case=> Curlill Vs Carbolic

PRESCRIBE ACT => two prescribed act in this case.
Offering of the €100 to anyone who used their smoke ball in a specified manner and period but
nevertheless still contracted influenza.
- Deposited €1000 in a named bank.

Held: Facts established a contract under which the det were bound to pay the
***€100 in relation to the
***following through with the prescribed act. The *** was entitled to receive the sum
=> advertisement held to be “unilateral”
=> prescribed act *** to use the ball
Performance of which = constituted acceptance
=> def intention to be boundwas clearly demonstrated by their deposit of €1,000.

Display of Goods for Sale

General Rule
=>Price-marked goods displayed in a shopwindow ARE NOT an OFFER for sale bid.INvitation to
TREAT - Fisher v Bell

Also goods displayed on the shelves of a self-service store(same rules)

Case: Pharmaceutical Society v GBU Boots

Auction Sales
General Rule
An auctioneer’s request for bids is an invitation to treat - Payne v Lave

=>bidder makes an offer which the auctioneer is free to accept or reject

=> acceptance is known/indicated by the FALL of FUE HAMMER(auctioneer)
=> this is also reflected in section 57 of the sales of goods Act 1979(this rule)

Auction without Reserve

Normally there’s a reserve price.
Request for bid =>an invitation to bid
=>Bid = offer, acceptance, fall of the hammers

Bilateral Contract
On the other hand, auction without reserveis a unilateral contract.In this case, the seller promises to
sell the highest bidder promises to sell to the highest bidder whatever that bid turns out to be

=> the auctioneer may be sued for breach of contract if they refuse to sell to the highest bonafide
bidder - case obiter dicta in the case of Warlow v Harrison

=> there are in fact two contract in a situation without reserve

1. Bilateral contract where in a auction sale, the bidder makes an offer which is applicable of
acceptance / rejection of it
 2. Unilateral contract based on the promise that the auction will be without reserve. If a reserve
isnt applied and goods are withdrawn from sale, there’s a breach of the contract. The bidder
in this case is entitled to be compensated by payment of DAMAGES. This person is not
entitled to the goods ****** - Barry v Davies

● Unilateral contract(PRESCRIBE ACT + INTENTION TO BE BOUND)

○ Acceptance is made through the performance of an act
● Remedy - where there’s a breach - Damages difference between the value of the painting
and the bid

Termination of an offer (R2L)

1. Rejection
2. Lapse
3. Revocation

Rejection (offeree)
Only takes effect while it is ACTUALLY communicated to the offerer

=> A counter-offer (made by the offeree) makes the ORIGINAL OFEER - VOID / REJECTED & CANNOT
be subsequently ACCEPTED - Hydve v Wrench

Note that the acceptance of a counter-offer -> TERMS & not that of the original offer becomes the
terms of the contract.

NOTE: the difference between a counter-offer & request for information [the [C-O] changes the
terms of the contract, the other [RI] doesn’t]

Case stevenson v McLean => held here that the claimant *** response was not a counter-offer but
rather an enquiry which did not serve to reject the offer.
-A binding contract was made when the claimant sent the telegram accepting the offer
Request for Information
1. Seeking clarification of the extent of terms of the offer
2. Ascertain if the offeror would consent to cleaning certain ANCILLIARY(providing necessary
support to be primary activities) aspect of the offer

LAPSE
1. By **** of time
2. Death of one of the parties

TIME
● Acceptance NOT made within the time period prescribed by the offerror
● No prescribed period, turn within a REASONABLE time will be applied. This will depend on the
circumstances of the case

DEATH
● If the offeree has knowledge of the death of the offeror, the offer will LAPSE if unaware, it will
probably NOT
● In the reverse, the death of the offeree will cause the the offer to lapse. So treat cannot be
accepted AFTER the death by the offeree’s REP

REVOCATION (offeror)
=>Acceptance is perceived as the complete performance of an act.
Unilateral Act=> it is possible to revoke the offer at anytime prior to the completion of the required
act. => Great Nortu v Wituam

Exception to the rule

Where offeree has
a. Partly informed the obligation & is willing & able to complete
b. It would undoubtedly cause hardship to the offeree to allow the offeror to withdraw the offer
in the given situation (under the circumstances). There’s an implied obligation not to revoke it.
Errington v Errignton => held that the promise could not be revoked after the couple had
stated to pay the installment & as long as they continued to be paid.
Also note: where an offer “unilateral” is made to the “whole world”, there’s no requirement that
those performing should “communicate” their intention to accept it - Carllill v Carbolic

Note that acceptance in the case of the “whole world” offer is made when a valid acceptance is
made by any person with the notice of the offer - Carllill

Revocation
THe offeror may REVOKE their offer t any time before ACCEPTANCE - Payne v Cave
Once a valid offer has been made(communicated), the offeror is bound. [An offer cannot be revoked
after acceptance] note

=> Communication - revocation is the effective only upon ACTUAL NOTICE of it reaching the offeree
Note=> communication by the post takes effect from the moment it is RECEIVED by the offeree &
NOT from the time of posting
=> Bryne v Van

Indirect
Offeror has shown
1. By words / conduct / CLEAR intention to revoke their offer & NOTICE has reached the offeree,
the revocation is effective
2. The means doesn’t matter. Effective even if communicated by 3rd party => Dickinson v Dodds
**how do they know that the info from the 3rd party is reachable -> ************

ACCEPTANCE (4 in total)
General Rule
Acceptance must be communicated to the offeror and silence does not amount to acceptance
- Information given by a 3rd party only gives rise for a contract to come “INTO EXISTENCE”
- Fact of acceptance by 3rd party = Yes
- Communication without authority = No

Acceptance
● Must be in response to the offer
● Must be unqualified**
● Necessary to follow a prescribed “mode of acceptance”
Must be in response to the offer
Only a person/persons to whom an offer is made can accept it

Must be unqualified
Correspond exactly with the terms of the offer. Mirror | maye rule 6* - hyde v Wrench

Precribed mode of acceptance

=> generally ut o the offeroee to choose. However => if it is prescribed by the offeror, ask if any
other mode of acceptance will suffice

=> it is open to the offeror to prescribe a mode

=> if this is the case. The mode spelt out must be clear & delineate. [clear and mandatory]...
Manchester v Commercial

However, unless the prescribed mode of acceptance is made mandatory, other mode of acceptance
in NO LESS advantageous to the offeror will be binding… Tinn v Holfman

ACCEPTANCE & COMMUNICATION

General Rule
Acceptance must be communicated to the offeror

Postal Rule (Adams v Lindsell)

Burden on the offeror than the offeree
Further exception to the rule that acceptance has to be communicated to the offeror

What is the rule - where a post is deemed to be a proper means of communication, the acceptance
takes place / effect front he moment the letter of acceptance is properly posted & not from the
moment it is received by the offeror.

Properly posted means

1. Put into an official letter box
2. Into the hands of a postal operative who is authorized to receive letters and not a postal
operative who is only authorized to deliver letters

This rule applies => acceptance delayed / lost in the post … Household v Grant
Henthron v Frater
=> use this rulewhere it was reasonable in all the circumstance for the offeree to have used the post.
***=> it has to held to be unreasonable to use the post when there us IMPLIED condition that
PROMPT ACCEPTANCE is required.

=> Does not apply to letters revoking offers

Revocation of an offer must be receivedin order to be effect - Bryne v Van

=> Does not apply if acceptance is incorrectly addressed

Does not apply if disapplied by offeror

Where actual communication is required, the postal rule wouldn’t apply. E.g. receipt of acceptance is
required / acceptance had to be received, postal rule will be ***
Set aside / *** the postal rule
=> a letter of acceptance would only be effective if and when it is received
Case => Holwell v Hughes

Instantaneous Means
General Rule
In the mode, acceptance takes place at the moment the acceptance is received by the offeror …=>
Entores v Miles
Note that where the message of acceptance is not received, without any fault on the part of the
offeror, NO CONTRACT has been concluded
In the high court decision of
(displaces the postal rule on email)Thomas v BPG, it was held that postal rule is inapplicable to
email communication. An acceptance by email is not effective when sent, but only when received
***********
Also note The Brimens - held that
A message that had been sent during ordinary office hours on friday but not been seen by office
staff until tuesday if monday was effective when received

=> in the case of outside ordinary office hours

Case Mondial Shipping v Astarte
A message was sent on 23:41 on friday, 2 december. It was held that the message was received at
the start of business on monday, 5th december.