Overview:

CAF 04: Business Laws Offer and Acceptance are two most important elements of a Valid Contract.
Chapter 02: Introduction to Contract This chapter discusses:
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Offer: Essentials, Communication, Revocation
(For students of Muhammad Asif, FCA) (For Spring 2022)
Acceptance: Essentials, Communication, Revocation
Contract: Essentials, Types

Part 1: Definitions and Basic Concepts

LO 1: Definitions LO2: Essentials of a Valid Contract LO 3: Types of Contracts

Offer/Proposal: 1. Offer and Acceptance Valid Contract: (Enforceable by Law) Void Agreement Vs. Void Contract:
One person shows his willingness: 2. Intention to create legal relationship Void Contract: (Not Enforceable by Void agreement: Void from start.
To do, or 3. Capacity/Competence of Parties Law) Void Contract: Valid from start but
Not to do something. 4. Free Consent Voidable Contract: (Enforceable at the became void subsequently.
5. Consideration option of aggrieved party)
Acceptance: 6. Legal Consideration/Object
When offeree communicates his consent to offeror. 7. Possibility of Performance
8. Certainty
Agreement: 9. Not expressely declared Void
Offer + Acceptance + Consideration = Agreement 10. Writing and Registered (Natural love and
affection, Time-barred debt, Arbitration)
Contract:
Agreement + Enforceability by Law = Contract. Part 3: Acceptance

Basic Concepts LO 7: Essentials of Acceptance LO 7: Communication of Acceptance LO 7: Revocation of Acceptance

Offer/Acceptance/Agreement can be either:
Express (by words spoken or written), or
Implied (by conduct of parties)
Parties to the contract are called 1. Absolute and Unconditional. When: Before it comes to
"Promisor" and "Promisee". 2. Within stipulated or reasonable time. Against Offeror (when it is knowledge of Offeror
Other parties are called "Third 3. According to stipulated or reasonable mode/manner. sent by offeree)
Parties", or "Stranger to the contract". (If deviated, offeror may either accept or shall Against Offeree (when it
communicate non-acceptance) reaches offeror)
4. By person to whom it is made. (or his Agent)
5. Communicated to Offeror.
6. Not before offer.
7. Not implied from silence.
8. Rejected offer cannot be accepted.
9. Performance of condition, or acceptance of
consideration = Acceptance

Part 2: Offer

LO 4: Types of Offer LO 5: Essentials of Offer LO 5: Communication of Offer LO 6: Revocation/Lapse of Offer

1. Specific (to specific person)
2. General (to general public)
3. Counter (cancels original offer)
1. Two Persons.
2. Intention to create legal relationship.
3. Certain and Definite.
4. Offer may be Conditional. (accept as it is)
5. Communicated to Offeree.
6. Invitation to Offer, is not an Offer.
Examples of Invitation to Offer:
Advertisement for Auction
Display of goods with price tags at store
Circulation of Information
Notice of Tender
How: 1. By Offeror (before acceptance)
Express or Implied. 2. By Offeree (effective when it reaches offeror)
3. Non-fulfilment of condition
When: 4. Time passed.
When it comes to knowledge of Offeree. 5. Death or Insanity before Acceptance
Death of Offeree Important Concepts for Case Studies:
Death of Offeror 1. Revocation of Offer
6. Counter Offer 2. Communication and Revocation of Acceptance.
7. Subsequent illegality or destruction