Section 5 – General Considerations

• A proposal may be revoked in a manner that the revocation reaches the offeree before the acceptance is communicated,
or posts the acceptance.
• An offer continues to be in existence until it is accepted or revoked. Once the offer is accepted, it is irrevocable. Revocation
must be brought to the knowledge of the offeree.
• An acceptance can be revoked before the acceptance reaches the offeror. Revocation of the acceptance must reach the
offeror before the acceptance reaches the offeror.
• If the revocation of a proposal reaches the offeree after the offeree has accepted the proposal – the contract is concluded
and the revocation is invalid. A proposal cannot be revoked after acceptance has been communicated under S 4.
• Revocation of the offer must be brought to the knowledge of the offeree before the offeree posts the acceptance.
• An offer may be withdrawn, but if the contract states that withdrawal will amount to forfeiture of money or the contracted
objected, then the forfeiture is not affected by the withdrawal.
• A contract may stipulate that the offer will not be withdrawn before specified date and time, but there must be
consideration here – this must be a distinct contract with a distinct consideration. However, where a contract does not
include such a clause, an offer may be withdrawn under S. 5. An offer cannot be revoked if a statutory obligation to keep
the offer open exists. This has been criticized as causing hardship to the offeree as the offeree must purchase the option
here.
• A standing offer (an offer to supply goods or services as and when required by the buyer) may be revoked at any time with
reference to the goods not ordered by the buyer. Standing offers are not contracts in themselves, but each supply of goods
or services (acceptance) will result in a contract for that instance. It is a series of promises.
• At an auction, a bidder may withdraw the bid at any time before the hammer falls – before the auctioneer accepts it.
Therefore, a contract comes into existence in such cases only after the auctioneer accepts the bid. A bidder makes a
proposal. Auctioned goods are treated as invitations to offer.