Offer and Acceptance

Characteristics and Legal Rules Regarding an Offer

 An offer may be expressed or implied

 An offer must reflect on creating legal relations and to give rise to legal
consequences
 The terms of an offer must be certain, not vague
 An invitation to treat
 An offer may be specific or general
 The offer must be communicated to the offeree
 No obligation on offeree to reply
Invitation to Treat

 Invitation to give an offer

 Advertisement, Display of Good, Auction Sale, Tender
 Advertisement- The person advertising to sell goods is not bound to sell to every customer
who comes to buy
 General Principle- Advertisement is an invitation to treat, not an offer
 Exception: Carlill vs. Carbolic Smoke Ball Company (1892)
 In this case, the advertisement was considered to be an offer, not an invitation to
treat because, their seriousness proved that they intended to create a legal relation
with the consumer
Lapse and Revocation of Offer

 An offer lapses after a reasonable or stipulated time

 An offer lapses when the usual or prescribed mode is not followed
 An offer lapses by rejection
 An offer lapses when the offeror or offeree dies or becomes insane
 An offer lapses by subsequent illegality
 An offer lapses by the destruction of subject-matter
 Revocation of offer (S- 5, the Contract Act, 1872)
 Revocation of a non-fulfilment of condition precedent to acceptance
Characteristics and Legal Rules regarding Acceptance

 Can only be accepted by the person to whom the offer was made
 An acceptance must be absolute and unqualified (S-7, the Contract Act, 1872)
 Conditional acceptance and counter offer
 Acceptance must be done in some usual mode or reasonable manner
 Must be communicated to the offeror
 Must be done within the stipulated or reasonable time or before it is revoked
 Acceptance of rejected offer can be done when renewed
Counter Offer

 When the offeree accepts the offer with a changed term or condition, it is counter offer
 Counter offer rejects the original offer and creates a new offer
 Mr. Simon offers Mr. Diamond to sell his guitar which is black in colour for 5,000 taka.
Mor. Diamond agrees to buy if Mr. Simon paints it red. This is a counter offer by Mr.
Diamond
 Hyde vs. Wrench (1913)