Termination of an offer

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  • Termination of an offer
    • Rejection
      • Once an offer is rejected, it cannot be accepted and it comes to an end.
      • The person to whom the offer is made doesn't have a 2nd chance to accept it.
      • If the person attempts to accept the offer they are making a new offer that the person who originally made the offer can accept or reject.
      • The rejection must be a clear one.
    • Time
      • Some contracts are made for a fixed period of time.
      • An offer will terminate after a reasonable lapse of time.
        • A reasonable lapse of time depends on the circumstances of the case
        • The defendant offered to purchase shares in the claimants company at x price. 6mnths later the claimant accepted this offer by which time the value of the shares had fallen The defendant had not withdrawn the offer but refused to go through with the sale. Claimant bought an action for specific performance of the contract.
          • It was held that the offer was no longer open as the nature of the subject of the contract had lapsed after a reasonable period of time.
    • Death
      • In English law, contracts can be enforced against a dead person.
        • This is done if necessary by suing the deceased's executors or administrators
      • An offer made by a person who dies before the offer ends cannot be accepted if the person to whom the offer is made knows of his death
      • BRADBURY V MORGAN (1862)
        • It was held that if the offeree accepts in ignorance of the death of the offeror, a contract might be formed.
      • DICKINSON V DODDS (1876)
        • BRADBURY V MORGAN (1862)
          • It was held that if the offeree accepts in ignorance of the death of the offeror, a contract might be formed.
        • Comparison;Here, it was held that the death of either party to the contract terminates the agreement because there can be no formal acceptance.
          • Best view - no party can accept an offer once they find out about the death of the offeror but in some circumstances, the offer could be accepted if made in ignorance of the offeror's death.
      • Revocation (withdrawal)
        • The offeror must receive communication of the withdrawal. At this point he can no longer accept the offer.
        • The offeror may revoke an offer at any time before acceptance.
        • ROUTLEDGE V GRANT (1828)
          • D offered to take a lease of P's premises, a definite answer to be given within 6wks. After 3wks D withdrew the offer, and just within 6wks the offeror accepted it.
            • It was held that the acceptance was too late; if 1 party had 6wks to accept an offer, the other has 6wks to put an end to it.
        • This may not apply in unilateral offers where acceptance requires full performance.
            • A father-in-law purchased a house for his son and daughter-in-law to live in. The house was put in the father's name. He paid the deposit as a wedding gift and promised the couple that if they paid the mortgage installments, the father would transfer the house to them.
              • The father became ill and died and the mother inherited the house. The son went to live with his mother but the wife refused to live with the mother and continued to pay the mortgage installments. The mother brought an action to remove the wife from the house.
                • Held that the wife was entitled to remain in the house. The father had made the couple a unilateral offer.
                  • Under normal contract principles an offer may be revoked at any time before acceptance takes place, but with unilateral contracts, acceptance takes place only on full performance.
      • Counter offer
        • Is where the offeree responds to an offer by making an offer on different terms
          • In effect, the offeror becomes the offeree and vice versa.
        • This has the effect of destroying the original offer so that it's no longer open to the offeree to accept it.
        • This offer rejects the original offer and creates a new offer than can be accepted or rejected.
        • HYDE V WRENCH (1840)
          • The defendant offered to sell a farm to the claimant for £1,000. The claimant in reply offered £950 which the defendant refused. The claimant then sought to accept the original offer of £1,000. The defendant refused to sell to the claimant and the claimant brought an action for specific performance.
            • It was held that there was no contract & where the counter offer is made, this destroys the original offer so it's no longer open to the offeree to accept.


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