Offer and Acceptance

Sheena Problem

An offer is an expression of willingness to be bound by the terms of the offer once it is accepted. The
offer may be made by words, in writing, conduct or a mixture of all three. An offer can be made to one
person, a group of people or to the world at large, e.g. where a reward is offered for a lost item, this is
normally made via an advertisement and this is seen as a unilateral offer, which is one sided (Carlill v
Carbolic Smoke Ball Co.).

Sheena sees an advertisement in a window which states 'All mini disc players at � 10 to the first twenty
customers on Monday morning'. Sheena wishing to accept this offer queued up all night on the Sunday
and was customer number seven. Once entering the store and selecting the mini disc player, she is
informed that the management has decided to end the promotion. Due to this offer being a unilateral offer,
the communication of the revocation of the offer is inappropriate. The rule that revocation must be
communicated was established in the case of Byrne v Van Tienhoven, where a telegraph was sent on the
11th October, but a letter withdrawing the offer was posted on the 8th October was only received on the
20th October. The offer therefore was accepted on the 11th October so the revocation was invalid. As it
states in the Shuey v US that if 'the same notoriety was given to the revocation that was given to the offer'
the revocation is valid, whereas in this case, the same notoriety was not given. The Unreal Department
Store did not therefore give reasonable steps to notifying persons who might be likely to accept of the
revocation of the offer. Also it is importance that the revocation must take place before the acceptance,
this is shown in Daulia Ltd v Four Millbank Nominees Ltd where the Court of Appeal considered that a
unilateral offer could not be withdrawn once performance had started. For example in the case of Carlill v
Carbolic Smoke Ball Co. in Mrs. Carlill's situation this would have been when she bought the smoke ball.
However, in the Daulia case, the statement was obiter, since the court found that the offeree in the case
had completed his performance before the supposed revocation. Therefore in Sheena's case, her
acceptance of the offer was when she queued up and entered the store as the seventh customer, this is
accepting the offer via conduct shown as mentioned earlier in the Carlill case and also in Brogden v
Metropolitan Railway Co. (1877) which is important with acceptance by conduct, this looked like a
counter offer but it wasn't due to the conduct of the parties. The general rule is that acceptance is not
communicated until it is received by the offeror. This is not really a problem when the parties are face to
face, although Lord Denning in Entores Ltd v Miles Far East Corporation (1955) he said: "Suppose, for
instance, that I shout an offer to a man across a river or a courtyard but I do not hear his reply because it is
drowned by an aircraft flying overhead. There is no contract at the moment. If he wishes to make a
contract, he must wait till the aircraft is gone and then shout back his acceptance so that I can hear what
he says. Not until I have his answer am I bound." The question was where exactly a contract was made in
the case of instantaneous communications; it is similar in Sheena's case, on where her acceptance of the
offer was made. It is important to be aware of where the acceptance of the offer takes place, in Confetti
Records v Warner Music 2003 where a record company produced an album from music sent to them by
Confetti. It was then held too late for Confetti to revoke their offer. The beginning and completion of the
production of the album was considered to be the acceptance of the offer and therefore the revocation of
the offer was too late. Sheena's case is similar to that of Lefkowitz v Great Minneapolis Stores, where a
man was refused to be allowed to buy a fur coat on offer due to the advertisement was intended to be for
women and therefore women to buy the item. It was held that the man had accepted the terms of the offer
in the advertisement and was entitled to the coat. Sheena accepted the terms of the offer for the mini disc
player and therefore she is entitled to buying the mini disc player for � 10. It was also indicated in the
Lefkowitz case that the advertisement was not an 'invitation to treat' but an offer. The advertisement
Sheena saw was not an 'invitation to treat' as it was offering a reward unlike in the case of Partridge v
Crittenden (1965) where an advertisement in a magazine offered Bramble finch cocks and hens for 25
shillings each. Bramble finch was a protected species and the person making the offer was charged
unlawfully for offering the sale of wild bird contrary to protection of Birds Act 1954. The conviction was
quashed as it was said that the advertisement was an invitation to treat. It is clear that when it comes to
revocation, clearer authority is needed on the issue of revocation in unilateral contracts. 

Later on Sheena finds a pair of shoes labelled � 25. Sheena decides to purchase these shoes and goes to
the cash desk. Tom, the cashier, informs her that they were actually � 35. Sheena believes that she
should be allowed to buy the shoes at the labelled price. It is important to distinguish a true offer from
what is known as an invitation to treat. An example of a case which is similar to Sheena's is Fisher v Bell
based on the display of goods with a price ticket attached. Where the defendant displayed a flick knife in
his shop window. He was convicted of a criminal offence of offering knives for sale, but on an appeal,
Lord Justice Parker stated that it was an "invitation to treat not offer", therefore the conviction was
overturned contrary to the legislation. In this circumstance, the shoes Sheena wished to purchase are in
fact an "invitation to treat", otherwise if it was a offer, then on taking them to the cash desk she would be
accepting the offer, as Lord Justice Somervell stated in the Boots Case : "otherwise customers wouldn't be
able to change their minds". In this case, Boots was charged with the offence concerning sale of certain
medicines which could only be sold by a pharmacist, or under supervision of a qualified pharmacist. The
issue was that when a customer picked the medicine up off a shelf, they were not being supervised and
therefore was committing an offence. The Court of Appeal stated that the shelf display was not an actual
offer but an invitation to treat and therefore the offer is made by the customer when being paid for at the
cash desk, at this point it would be supervised by a pharmacist, therefore there was no offence. This
giving Sheena a good argument that when she approached the cash desk the price on the shoes was an
invitation to treat and she offered that price making her the offeror. When the cashier, Tom, informed her
that the actual price was � 35, he was in fact making a counter offer. A counter offer terminates the
original offer, the main case highlighting this is Hyde v Wrench , where the defendant offered to sell his
farm for � 1,000 and the plaintiff responded by offering to buy it for � 950. Therefore the plaintiff
made a counter offer. The farm owner refused and the plaintiff then tried to buy for � 1,000, but it was
held that this offer was no longer available; it had been terminated by the counter offer. It is then up to the
farmer to make a new offer. Sheena may decline the counter offer of � 35, but unless she decides to
make a new offer, the offer at the moment would be � 35. It must be made clear whether it is a counter
offer or a request, which isn't actually killing the offer, due to it sometimes is difficult to tell whether a
counter-offer has taken place, sometimes it is merely a request for information, shown in the case of
Stevenson v McLean (1880) where in this case, in response to an offer to sell iron, the price and quantity
was accepted but the offeree wished to know whether delivery could be staggered. The defendant
believed that the request had actually been a counter offer and therefore sold the iron to a third party. His
claim that it was a counter offer failed as it was believed that it was not a rejection of the offer, merely an
enquiry about it, and the offer was still open to acceptance. A final case that holds the principle that a
second offer will revoke the first offer if it is completely inconsistent with the first is Picksford v
Celestrica (2003) where Picksford sent a fax but later sent a second fax with more definite details which
was seen as a counter offer. Celestrica sent a confirmation with different terms agreeing with the first fax,
this being a second counter offer. Picksford accepted the counter offer by its conduct of performing its
services therefore Celestrica's counter offer was the accepted. Overall, these cases prove that Sheena can
buy the shoes for the price which it stated on the label, if she made a counter offer to Tom of 25 pounds
and he accepted it. 

On Sheena's way out of the store, she found a wallet belonging to Nick. She returns it to him and then on
her way home she notices a poster on a notice board requesting the return of the wallet and offering a
reward for � 50. She then returns to Nick's house where he says that he is a not going to pay her the
reward. Whether or not Sheena can receive the reward is very simple answer. The offeree cannot accept
an offer which he/she does not realise exists. This is shown in the case Bloom v American Swiss Watch
Co. (1915) where information was given which led to the arrest of thieves who had broken into a man's
premises. The person whom gave the information was without knowledge of the � 500 reward being
offered by the man. On finding out about this reward he tried to claim it. It was held that because he was
unaware of the existence of the reward, he could not accept it and the man was not required to pay the
reward. This case legally connects but seems morally unsatisfactory for Sheena's case. This proving that
Sheena could not accept the reward unless Nick decided to give it her, although he does not have to do
this. An Australian case similar to this was R v Clarke where a different conclusion was reached.
Although the man saw the offer, when he later decided to give the necessary information, he not only
admitted to acting solely to save his own skin, but also at the time he gave the information, the question
of the reward had passed out of his mind. It was held that his claim must fail, as they believed he was in
the same position as if he had never heard of the reward. Therefore Sheena took the wallet back to Nick
without being aware of the reward therefore she was not motivated by the offer and the existence of the
offer had no effect on her returning of the lost wallet. Another case following along the same line as
motive for acceptance is Williams v Carwardine (1833) where the person actually was aware of the
reward but gave the information due to the motives of spite and revenge. Although she gave information
for this, she was aware of the reward and therefore was entitled to the reward.

In conclusion, Sheena was entitled to purchasing the mini disc player for � 10 due to her accepting the
offer, the offer was never revoked as it must take place before acceptance and on queuing and entering the
store, Sheena had accepted the offer. Not enough reasonable steps were taken to revoke the offer before
acceptance. Sheena will only be able to purchase the shoes for � 25 if she offers a counter offer of �
25 and the cashier, Tom, accepts this, otherwise no contract will be made without an acceptance. Nick
does not need to give Sheena the reward, although he may offer it her, he does not have to as she was
unaware of the reward before returning it to him, and she returned this to him without a need for a motive.